A startup is defined by the Indian government as an entity that has been operating for less than seven years and with an annual revenue of less than 250 million rupees. It’s a positive, effective ecosystem that turns business ideas into a flourishing startup environment thanks to the Startup India initiative by the Ministry of Industrial Policy and Promotion. The government’s initiative resulted in startup policies being introduced in states and union territories across the country. Though the demonetization in November 2016 shook up various sectors of India’s economy, its ranking as one of the easiest places to do business is steadily improving.
There are currently 38 unicorn companies in India, making it among the world’s top three startup ecosystems. Despite the economic disruption caused by Covid-19, the country produced around 12 unicorns in 2020.
With the government opening up the space sector for private players, more than 40 startups have funded, developed teams and structures for space and satellite initiatives, according to the survey.
(Economic Survey on Startups in India 2021)
As technology plays a major role in unlocking the country’s space potential, the number is also expected to increase in the coming years.
In the Economic Survey 2020-21, the government announced Friday that 41,061 startups were recognized as of December 23, 2020. A survey showed that more than 39,000 startups have created more than 470,000 jobs, although details were not revealed.
In recent years, the government has taken several measures to support startups, including broadening the definition of startups, simplifying regulations, providing income tax exemptions and setting up a Rs 10,000 crore Fund of Funds for startups operated by the Small Industries Development Bank of India (Sidbi).
Sidbi had committed Rs 4,326.95 crore to 60 Alternative Investment Funds (AIFs) registered with SEBI on December 1, 2020.
Funds in these categories have raised a total of Rs 31,598 crore, invested Rs 4,509.16 crore in 384 startups and taken on debt of Rs 1,270.46 crore, according to the survey.
It also noted that around 319 startups have been granted income tax exemptions till November 2020.
In addition, the Startup India Seed Fund Scheme received government approval on Friday.
As part of Startup India’s Startup Yatra initiative in 2017, which searched for entrepreneurs in Tier 2 and Tier 3 cities, 207 districts across 23 states, impacted 78,346 aspiring entrepreneurs. The survey noted that 1,424 offers of incubation have been given to startups as part of this initiative.
India’s struggling economy seems to be the only drawback to the country’s explosive startup economy. As a result of the coronavirus (COVID-19) outbreak during March and May 2020, even more damages were sustained. Even with collaboration between public and private sectors, many startups experienced revenue losses and permanently or temporarily closed their doors. To survive the impact of the pandemic on India’s startup ecosystem, it will need strong pillars to lean on.
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