Startup India Action Plan

What is Startup India

Startup India is an initiative launched to give new opportunity to the innovative youths of the country in order to more job in India. It is an active support started by the government of India to motivate new entrepreneurs as well as a chance to see some new dreams in the field of development. The action plan of this initiative was launched by the PM Narendra Modi on 16th of January, Saturday 2016 at Vigyan Bhawan, New Delhi. This event was organized by the Department of Industrial Policy and Promotion (DIPP). The aim of this event was celebrating the entrepreneurial spirit of India. It aims to create strong network in India to promote innovations and startups in business by the youths.

What is Action Plan

The action plan of the startup India initiative has a list of sequential activities and well-defined steps taken by the government of India for the same. Action plan has an outline of all the most important priorities required to focus on the aim of this initiative. Action plan is prepared to give a strong support to the startups of India to create various small businesses for more job creation. It ensures new innovative entrepreneurs to start a business with full support. It is to initiate ‘Make for India’ after the initiative ‘Make in India’ by the youths of the country. It will make Indian youths, who are willing to do something new in the field of business, more confident and energetic. Now, youths can start their own business in favor of India without having much fear of getting failure as this action plan has various effective plans for them.

The whole action plan is the wheel of the startups India initiative made for supporting them who are new in business however full of innovative ideas. This initiative is the strong belief of the Indian PM Narendra Modi that our Indian youths can do better in the field of development through businesses if they are given a strong support and chance to implement their innovative ideas of business without any fear and governmental system delay in the process.

Benefits of Action Plan

Action plan is a well-formed plan of action prepared by the government to set business startups with full support and in the right direction. Action plan provides clarity to prioritize and allocate time and resources in better way to fulfill objectives of the programme. Actions plan becomes a guidebook which helps one to set on the right track. Generally, a business owner faces many unpredictable problems on the way of setting a business. The first and foremost thing is that he/she has to invest his/her own money without being sure of the surety of success in that business. Many times the business becomes fail and if one has further courage, he/she starts again otherwise becomes hopeless because of the lack of motivation and finance.

This action plan created by the government will be proved as a strong support for the courageous and motivated youths of the country to do some new and effective business. It is a big risk taken by the government of India by creating such a surprising action plan in the favor of youths. According to this action plan, startups will be supported with finance, tax benefits and various other favorable supports through flexible government systems. It aims to empower youths in various working areas from digital/technology sector to the wide range of sectors such as agriculture, social sector, manufacturing, education, healthcare, etc.

This action plan will help startups to easily tackle with all the potential obstacles on the way. Action plan ensures the right steps in right direction. This action plan is dream list of the activities to be done in the favor of this initiative. It will prioritize the required actions which are legally necessary for the quickest payback to the business.


What are Action Plan for Startup India

The action plan of this campaign was successfully launched by the PM Narendra Modi on 16th January 2016. Following are the well described action plan for startup India:

Simplification and Handholding

Following facilities are provided under this, such as:

  1. Compliance Regime based on Self-certification:

It will help youths to reduce their regulatory burden as well as focus on their core business by keeping compliance cost low. According to this scheme, startups have been given required friendly and flexible (simplifications in regulatory regime) compliance with labour and environment laws in order to prevent time and effort. Inspection process has been made easy and simple through the online startup mobile app as well as there will be no inspection for first three years however they can be inspected after complaint of violations. Startups (in case of environment laws) coming under white category (defined by Central Pollution Control Board) are able to self-certify compliance however random checking can be performed.

  1. Startup India Hub

According to startup India hub, there will be single point of contact to connect entire startup ecosystem in order to enable knowledge exchange as well as access to funding. Our country is full highly skilled and confident youths who have capability to start business on their own however need some favorable environment. Many of them get discouraged and failed due to lack of guidance and access of needed ecosystem. Startup India hub is a friend, mentor and guide for all the startups who have courage to take risks in life. It will hold their hand and go together all through the journey. Startup India hub will ease the doing of business by creating exciting and enabling environment through the implementation of various effective measures for all the startups. It will assist startups by organizing mentorship programmes in collaboration with needed organizations to focus on important aspects.

  1. Rolling out of Mobile App and Portal

Startups will be given support through the mobile app and online portal in order to easily interact with government and regulatory institutions regarding business needs and information exchange with other business persons involved. It will ease the establishments and operations of the business through fast and easy registration process which ultimately reduce the burden of startups. It will provide formal platform to the startups to get connected with collaborated with other partners of ecosystem. Online mobile app will enable startups with easy registration process having simple form, tracking the status of registration process and get digital version final registration certificate, collaborative platform, etc. However, it will be available on all the mobile devices from 1 April 2016.


  1. Legal Support and Fast-tracking Patent Examination at Lower Costs

It will provide easy access to high quality intellectual property services and resources (rebate in fees, fast track examination of patent applications, assisting panel of facilitators, etc) required to the startups to easily adopt Intellectual Property Rights (strategic business tool enhances industrial competitiveness of any organization).

  1. Relaxed Norms of Public Procurement for Startups

It will provide equal platform to the startups especially those who are in manufacturing sector. Startups will be supported to have their own manufacturing facilities in India.

  1. Faster Exit for Startups

It will enable startups to easily complete the operations. It will support startups to run businesses with new and innovative ideas without any fear of failure. According to this, startups can take exit within 90 days after applying for the exit.

Funding Support and Incentives

Following facilities are provided under this, such as:

  1. Providing Funding Support through a Fund of Funds with a Corpus of INR 10,000 crore

Finance support will be given to the startups for the development of the new business enterprises. Due to the lack of finance support startups may not able to completely perform their innovative ideas. The government of India will arrange the fund of funds (INR 2,500 crore yearly and INR 10,000 crore in 4 years) to support startups. It will not directly support them however through the SEBI registered Venture Funds.

  1. Credit Guarantee Fund for Startups

It will provide credit to the startups from all the sections of society in order to promote entrepreneurship by breaking Indian society stigma regarding failure of startups business. This plan will encourage banks including other lenders to support startups through venture debts.

  1. Tax Exemption on Capital Gains

It will provide tax benefits to the startups on their capital gains. According to this, investors will be given some incentives in order to invest among startups. Those startups, who have invested their capital gains in the government’s recognized Fund of Funds, will be given tax exemption. Capital gains invested in purchasing new assets for the enterprise will also be given tax exemption.

  1. Tax Exemption to Startups for 3 years

In order to promote entrepreneurship among startups, they will be supported through tax exemption for three years. Youths have capacity to think beyond the limit so they need more help to continue work on their innovative ideas. Initial years become the struggling years for any new entrepreneur that’s why government has decided to support for first three years through tax exemption.

  1. Tax Exemption on Investments above Fair Market Value

It is to encourage seed capital investments among startups. Tax exemption will be given to the investments over fair market value.

Industry-Academia Partnership and Incubation

Following facilities are provided under this, such as:

  1. Organizing Startup Fests for Showcasing Innovation and Providing a Collaboration Platform

It is to maintain the proper communication and collaboration within the startup community to gain national and international visibility. Government will promote the active participation of academia, investors, industry and other stakeholders by organizing the startup fest. Government has decided to hold at least one national level fest in the national city and one international level fest in the international city for the startup ecosystem. The activities like exhibitions and product launches, curated Startup walks, sessions to connect with mentors, investors, incubators, and startups, conferences with industry leaders, showcasing of innovations, mentoring sessions, competitions (Hackathon, Makerspace, etc) talks by disruptive innovators, announcements of rewards and recognitions, etc will be held during the startup fest.

  1. Launch of Atal Innovation Mission (AIM) with Self-Employment and Talent Utilization (SETU) Program

The facility of Atal innovation mission with the self employment and talent utilization program is given to the startups for promotion of world-class Innovation Hubs, Startup businesses, Grand Challenges, and other self-employment activities.

  1. Harnessing Private Sector Expertise for Incubator Setup

Government will promote and connect private sectors expertise (Department of Biotechnology, Department of Science and Technology, Ministry of Micro, Small and Medium Enterprises, Department of Industrial Policy and Promotion, Department of Electronics and Information Technology, Department of Higher Education, and NITI Aayog) to setup incubator all through the country. People will be benefited in many ways through incubation facilities such as provision of mentorship support, physical infrastructure, access to networks, access to the market, etc. According to this central government will provide around 40% fund support (maximum of INR 10 crore) to establish 35 incubators in the existing institutions. Funding support will be given by the NITI Aayog as part of Atal Innovation Mission.

  1. Building Innovation Centres at National Institutes

There is planning to set up 31 innovation centres at national institutes (offering facilities to more than 1,200 new Startups) including 13 startup centres with annual funding support of INR 50 lakhs for the first three years to promote student driven startups and 18 Technology Business Incubators at the NITs/IITs/IIMs etc.

  1. Setting up of 7 New Research Parks Modeled on the Research Park Setup at IIT Madras

There is plan by the government to invest around INR 100 crore in setting up 7 new Research Parks in the institutes in order to break traditional and artificial barriers of innovation as well as create and apply advancements in knowledge.

  1. Promoting Startups in the Biotechnology Sector

It is to motivate more innovative youths of the country towards biotechnology sector. Startups in this field will be supported by the government through the facilities like 5 new Bio-clusters, 150 technology transfer offices, 20 Bio-Connect offices, 50 new Bio-Incubators etc in the research institutes and universities all across the country. There is facility of Biotech Equity Fund (fund in partnership with National and Global Equity Funds) in order to provide financial support to the young Biotech startups.

  1. Launching of Innovation Focused Programs for Students

Government will promote research and innovation among students in the field of science and technology by launching innovative programs. Innovation core program will be created to target the school kids to achieve 10 lakh innovations from 5 lakh schools. Some of the best innovations will be shortlisted to showcase at the Annual Festival of Innovations at Rashtrapati Bhavan. Another program named National Initiative for Developing and Harnessing Innovations will support and award around 20 student innovations from IEDCs with INR 10 lakhs. Uchhattar Avishkar Yojana will promote IIT students for very high quality research. Funding contributions will be 50% from MHRD, 25% from DST and 25% from industry.

  1. Annual Incubator Grand Challenge

Government will support startups through creation of world class incubators. It will help in building an effective startup ecosystem and help them in the initial stage as well as other phases of the business lifecycle.

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