Non-Metro Cities House Over 50% Of The Recognised Startups

More than 50% of the recognised startups are now coming from non-metro cities, Minister of Commerce and Industry Som Prakash informed Lok Sabha on Wednesday. 

Among 72,993 startups that are recognised by the Department For Promotion Of Industry And Internal Trade (DPIIT), 34,473 or 48% recognised startups belong to metro cities of Delhi, Mumbai, Kolkata, Chennai, Hyderabad, Bengaluru, Pune and Ahmedabad.

Considerably, the number of recognised startups was 471 in 2016.

DPIIT has recognised startups which are spread across 56 diversified sectors, Prakash added. More than 3,300 DPIIT recognised startups are working in climate action sectors providing solutions through renewable energy and green technology, 

Additionally, more than 4,500 startups have been recognised in sectors relating to emerging technologies such as Internet of Things (IoT), robotics, artificial intelligence and analytics. 

“Startups and the entire innovation ecosystem are the engines of growth for any country,” the minister stated.

As the government has been working on many programmes to boost the startup sector, it has set up Atal Incubation Centres (AIC) to incubate startups in various sectors under the Atal Innovation Mission.

It has also launched Atal New India Challenge (ANIC) programme to directly aid startups with technology-based innovations that solve sectoral challenges of national importance and societal relevance, the minister added.

However, macroeconomic factors such as the ongoing Russia-Ukraine war, rising inflation and policy rates have impacted the startup ecosystem leading to cost-cutting, layoffs, and even shutdown in many cases.

The total funding raised by Indian startups in the second quarter of 2022 (CY22) saw a massive 42% decline to $6.8 Bn from $11.8 Bn in Q1 of the year, according to Inc42 analysis. In addition, the deal count also fell 22% to 393 in Q2 from 507 in Q1.

The overall funding saw a huge decline in May reaching $1.6 Bn from $3.4 Bn in April. However, it improved in June as the Indian startup ecosystem raised $2.65 Bn in the month.

In the second quarter of CY 2022,  four new  startups including Open, PhysicsWallah, Purplle and LeadSquared, joined the unicorn club. 

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