PM Narendra Modi’s Startup India initiative has hit them hard. The project is now waiting for a revamp due to a recently held review by the government, wherein a few startups applied for recognition and only one made the final cut.
Earlier this month, the government officials said that in last three months, out of 250 applications received, only one got clearance from the government to set up new business. The officials cited that incomplete registration process as a major reason for rejection.
Consequently, Department of Industrial Policy and Promotion (DIPP) has planned a strategy to upgrade the action plan and get more enterprises to take part in it.
The government will now examine all applications within a day. Besides, the companies those want to avail tax and intellectual property rights-related benefits will have to wait for the approval of the inter-ministerial board, formed by DIPP. Also, the startups will no longer need a certificate of recognition from the government to access legal help for filing patents. The service is being provided free to startups through an empanelled group of advocates.
Owing to the several complaints filed by the companies against the exorbitant charges for providing recommendation letters, the industry department has also planned to impose a cap on fees that can be charged by incubators for certifying a startup as an “innovative business.”
The prime minister kicked off the ‘Startup India, Standup India’ campaign in January this year.
The Modi government had declared the fund for startups in the Budget and accordingly INR 2,500 Cr each year would be released to SIDBI over the next four years. SIDBI has approved INR 930 Cr in disbursals from the INR 2,000 Cr fund-of-funds, it launched in August, to support venture capital funds for startups. The startup corpus of INR 10,000 Cr announced in the Startup India action plan is also expected to be put to use soon.
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