Despite having a host of initiatives for startups taken by the Indian government, the entrepreneurship quotient has barely changed on the ground. Under the government’s Funds of Funds initiative, while Small Industries Development Bank of India (SIDBI) is supposed to disburse INR 10K Cr by 2025, the organisation has committed only $170.57 Mn (INR 1,136 Cr) to 25 VC Funds, who in turn have invested only $85.44 Mn (INR. 569 Cr) in 120 startups so far.
While the Fund of Funds intended to create 18 Lakh jobs, as per SIDBI’s circular, these startups have generated 6,515 jobs including 1,184 jobs for women. Clearly, the policy implementation is not on the track, as expected.
One of the major reasons behind the gloomy picture is that most of the states initially were not on the same page and even after three-years of the Startup India policy initiative, many of the states are still in the process of rolling their startup policies out.
Amid low funding flow, DIPP monitoring committee has finally taken the matter with SIDBI, asking the latter to take the necessary measures that could increase the release of funding under Fund of Funds.
Taking further measures, the Indian government has finally scrapped the angel tax given that the funding is less than INR 10 Cr. However, with laying a series of barriers such as the “bureaucratic measures”, further amendments in Section 50 of Income Tax Act redefining Fair Market Value ( FMV), the road for stakeholders, startups and investors just got bumpier and needs immediate attention from the government’s end.
Let’s take a look at the last month’s startup policy developments!
Rajasthan: Govt. To Take 100 Student-Preneurs On An All Paid Exposure Trip To Silicon Valley
Taking a unique initiative among all the states, the Rajasthan government’s Department of Information Technology (DoITC) is now implementing a first-of-its-kind government initiative wherein the selected students from the local colleges will get a chance to travel to the Silicon Valley, US. The idea behind this step is to help broaden their vision and enable them to take a quantum leap towards their prosperous future.
The main aim of the programme is to encourage college students to take to technological innovations, to encourage them to come up with digital solutions to real-life problems and also to transform their ideas into successful businesses. To be a part of this programme, any student pursuing his or her higher education in any college of Rajasthan is eligible to apply.
It will be a two-week residential programme. The selected students will have the opportunity to develop ideas over software products while learning from some of the world’s best startup professionals.
Up to 100 students will be selected for the all-expenses-paid trip to the US where they will be hosted at Menlo College in Menlo Park, Silicon Valley. Over the course of two weeks, they will be exposed to various aspects related to building a tech startup.
Goa: Union Minister Suresh Prabhu Launches Goa Startup Policy
In continuation of the Startup India push, Goa has recently launched its startup policy and portal on Goa startup Day.
The Startup Policy envisions making Goa one of the most preferred startup destinations of India and featuring in the top 25 startup destinations in Asia by 2025.
The state startup policy envisages 100 successful startups in the course of the next five years.
Launched by Union Minister of Commerce and Industry and Civil Aviation Suresh Prabhu, Goa Startup Policy aims to make Goa an aspirational geographical and human resource base for startups. The policy contains various incentives for startups and to avail the benefits of these incentives, the startup policy includes various schemes by the government.
The Ministry, through the Invest India team, has been engaging deeply with the Government of Goa to propel the state as the “national capital for startups”. Invest India will also be providing support by extending call centre facilities for all the aspiring and existing Goan Entrepreneurs to learn more about the policy.
In a tweet, Prabhu said, “At the Goa Startups and Innovation Day, Goa with its strategic location and ecosystem, has the potential to be the entrepreneurship hub. We are working towards it. This event will contribute to the building of a robust ecosystem involving all stakeholders #GSID2018.”
EDII To Support 7,000 Youths Across 40 Districts In Starting Up
The government officials have appointed Entrepreneurship Development Institute of India (EDII) as the pan-India national implementing agency to facilitate entrepreneurship sensitisation under the title, ‘Sustainable Development through Science and Technology Lead Entrepreneurship in 40 Aspirational Districts’.
The move envisages to train over 7,000 youths spread across 40 districts (up to three in each state) in 28 states (except Goa) across India who have urged to set up small innovative startup — supported by the National Science and Technology Entrepreneurship Development Board (NSTEDB) under the Department of Science and Technology (DST).
The three entrepreneurship programmes will be convened from May-end in these 40 districts with around 60 participants each, for a period of nine months.
Speaking to Inc42, EDII DST-NIMAT-Project Director and Member Secretary SB Sareen said, “The idea to take the survey is to understand what exactly the ground realities are: what are the resources available; its population strength; education, literacy status; what kind of support or mechanism and banking structure are required; and what kind of business opportunities can be promoted.”
Odisha: Incubation Offers To 75 innovators
Having taken a series of initiatives already, the Odisha government has now offered free incubation offers to 75 young innovators in an attempt to boost the startup ecosystem in Odisha, reported The Telegraph.
Home to 200 startups, the state recently held Startup India-Odisha Yatra which received 3,600 startup ideas out of which 125 have been further shortlisted for the state-sponsored accelerator programme.
As per the report, 75 of them will be given free opportunities at IIT Bhubaneswar, STPI, I-Create at Ahmedabad and BIMTEC, New Delhi, Centurion University, KIIT- TBI, NIIST, Berhampur and Sri Sri University, Cuttack.
The shortlisted innovators will undergo three months of the incubation programme and 15 innovators, who will successfully complete the training at these institutions, will get a seed grant of INR 50,000 for further development on their ideas.
Meghalaya To Launch Startup Policy
Speaking on the budget discussion in the State Assembly, Chief Minister Conrad K Sangma informed the house that the state government will soon launch its startup policy in the next few months.
In line with the central government’s approach, Conrad stated that the state government wants to promote entrepreneurs and help them to take the lead. To kickstart entrepreneurship in the state, the government will also set up incubation centres in the state.
Maharashtra Plans To Set Up Startup Hub
To boost the startup momentum further in the state, the Maharashtra government will set up a world-class startup hub similar to the T-hub in Hyderabad.
The state Chief Minister Devendra Fadnavis has directed the information technology (IT) and skill development and entrepreneurship departments to constitute a team of experts to look into the possibilities of the startup hub, reported HT.
The Chief Minister has also called for a study into the existing innovation and startup ecosystem of the state.
Established under the Department of Skill Development, the Maharashtra State Innovation Society (MSInS) has also been directed to shortlist 24 business ideas and issue work orders worth $22,485 (INR 15 Lakh) to each of them as part of Maharashtra Startup Week 2018.
Startups will be shortlisted from sectors like education, skill, health, agriculture, clean energy, environment, water and sewage management, smart infrastructure, communication, finance and cybersecurity under the startup policy.
In news from Haryana, the state which had announced its startup policy last year during Digital Haryana Summit, has now decided to adopt startup ranking framework issued by the Department of Industrial Policy and Promotion (DIPP)
Bihar Shortlists 53 Ventures Under The Startup Policy
Having set up a trust with an initial corpus of $75 Mn (INR 500 Cr), the Bihar government has further selected 53 ventures that will help implement the state Startup policy 2017.
As per reports out of 4,635 applications received, 931 were shortlisted and 53 have been certified.
For the incubation programmes, the government has roped in various state organisations and institutions including Bihar Industries Association, the Chandragupta Institute of Management, Patna, NIT-Patna and NIFT.
In other news, owing to President Trump’s anti-Obama policy, the US startup visa programme is coming to an end. Badly threatened by President Trump, while only 10 applicants applied under the Startup Visa policy, it is also the end of the road for spouses of H-1B workers in the US as they will no longer be able to seek employment or set up their own business, which for many was something as simple as running a crèche, tutoring, conducting yoga classes or supplying desi home-cooked food to nearby offices, reported TOI.
As the states gearing up for the startup ecosystems in their states take a race, the startup policy initiatives, instead of taking randomly, must be taken to connect the dots. Otherwise, as did the angel tax to angel funding, a bureaucracy-dependent policy will end up having adverse effects on the startups in the state.
Hence, as promised by the PM Narendra Modi, the states must focus on minimum interference and maximum guidance (governance).
Stay tuned to Inc42, for more of the latest news on Startups Policies!