Startup India is a flagship initiative launched by the Government of India in January 2016 to promote and support the growth of startups throughout the country. This scheme is designed to foster innovation, facilitate entrepreneurship, and create a robust ecosystem for startups. Below is an overview of the scheme, its purpose, and how entrepreneurs can benefit from it:
Index
Purpose of the Startup India Scheme
The primary goals of the Startup India initiative are:
Fostering Innovation: Encouraging innovation in various sectors by providing resources and a supportive environment for entrepreneurs.
Economic Growth: Driving economic growth and contributing to job creation through the proliferation of new businesses.
Simplifying Regulations: Reducing the complexity of regulatory requirements and improving ease of doing business for startups.
Funding and Financial Support: Providing funding support and financial incentives to help startups scale their operations.
Key Benefits for Entrepreneurs
Entrepreneurs can gain a range of benefits by registering under the Startup India scheme:
a) Simplified Registration Process
Single-Window Clearance: Startups can register through a dedicated portal or the Startup India app, streamlining the registration and compliance process.
Self-Certification: Startups can self-certify compliance with labor and environmental laws, reducing the burden of inspections and paperwork.
b) Tax Benefits
Tax Holiday: Eligible startups can benefit from a three-year income tax exemption during their first ten years of operation.
Capital Gains Exemption: Startups can avail of exemptions on capital gains if they reinvest the money in a notified fund or startup.
c) Access to Funding
Fund of Funds Scheme (FFS): The government has set up a Fund of Funds with a corpus of INR 10,000 crore to support startups through Alternative Investment Funds (AIFs).
Seed Fund Scheme: The Startup India Seed Fund Scheme (SISFS) provides financial assistance for proof of concept, prototype development, product trials, and commercialization.
d) Easier Public Procurement Norms
Relaxed Norms: Startups registered under the scheme are exempt from prior experience or turnover criteria for participating in government tenders.
Faster Clearing: Specific guidelines help startups get contracts from government and public sector undertakings.
e) Intellectual Property Rights (IPR) Support
Faster Patent Processing: The scheme provides 80% rebate on patent costs and support for fast-tracking the examination of patents.
Legal Assistance: Startups can avail of legal and operational assistance for filing IPs at reduced costs.
f) Incubation and Networking Opportunities
Startup India Hub: This platform connects startups with investors, mentors, incubators, and other stakeholders to provide guidance and support.
Incubators and Accelerators: Partnerships with academic and industrial bodies help provide startups with training and workspace solutions.
Eligibility Criteria
To be recognized under the Startup India scheme, an entity must:
(1) Be incorporated as a private limited company, a registered partnership firm, or a limited liability partnership (LLP).
(2) Be less than 10 years old from the date of incorporation.
(3) Have an annual turnover not exceeding INR 100 crore in any preceding financial year.
(4) Be working towards innovation, development, or improvement of products, processes, or services.
Steps to Register Under Startup India
(1) Incorporate the Business: Register the business as a company, LLP, or partnership firm.
(2) Register on the Startup India Portal: Create a profile on the Startup India website and complete the registration.
(3) Submit Required Documents: Upload the necessary documents, including a Certificate of Incorporation and a description of the business.
(4) Get DPIIT Recognition: Apply for recognition from the Department for Promotion of Industry and Internal Trade (DPIIT) to access various benefits.
(5) Access Benefits: Once approved, the startup can avail itself of the various perks and incentives under the scheme.
Conclusion
The Startup India scheme is a comprehensive program that offers various benefits designed to help entrepreneurs overcome initial challenges and grow their businesses. By taking advantage of tax benefits, funding support, streamlined processes, and networking opportunities, startups can scale more effectively and contribute to the broader goal of economic development and job creation in India.
