India’s startup ecosystem has been on a remarkable rise in recent years, with innovative entrepreneurs driving economic growth and job creation. To nurture and support this burgeoning startup culture, the Indian government has rolled out an array of schemes and initiatives aimed at providing financial assistance, mentoring, and infrastructure to startups across various sectors. In this article, we will delve into some of the key government schemes and programs designed to bolster the Indian startup ecosystem.
- Startup India Seed Fund: Launched by Prime Minister Narendra Modi in January 2021, the Startup India Seed Fund is a significant step towards ensuring that startups in India have access to adequate capital. With an allocation of INR 945 Crore, this fund is set to support around 3,600 entrepreneurs through 300 incubators over a four-year period (2021-2025). The fund will be disbursed through eligible incubators, facilitating the growth of innovative ideas and startups.
- Startup India Initiative: The Startup India Initiative, initiated in 2016, has introduced several programs aimed at building a robust startup ecosystem in India. Startups recognized by the Department for Promotion of Industry and Internal Trade (DPIIT) under this initiative gain access to a range of benefits, including tax incentives, simplified compliance procedures, and fast-tracked intellectual property rights. As of March 2023, over 96,000 startups are registered under this initiative, highlighting the tremendous interest and enthusiasm among entrepreneurs.
- SAMRIDH Scheme: Launched by the Ministry of Electronics Information and Technology (MeitY) in August 2021, the SAMRIDH scheme focuses on accelerating IT-based startups with the potential to solve critical issues in India. The scheme offers funding of up to ₹40 lakh per startup and invites accelerator programs to partner with MeitY. This initiative aims to support around 300 tech startups through various cohorts.
- Startup Leadership Program: The Startup Leadership Program (SLP) is a prestigious, selective, and highly beneficial training program for founders and innovators. Introduced in India in 2016, it has expanded to over 14 countries and numerous cities, helping thousands of startups raise substantial funds. Programs like SLP provide valuable support to emerging entrepreneurs.
- ASPIRE: The Scheme for Promotion of Innovation, Rural Industries, and Entrepreneurship (ASPIRE) is designed to promote entrepreneurship and innovation in rural India. Launched in 2015 by the Ministry of Micro, Small and Medium Enterprises (MSME), ASPIRE aims to reduce poverty, increase employment, and encourage innovation in the rural sector, particularly in agro-business. The government initially allocated INR 200 crores for this scheme.
- Pradhan Mantri Mudra Yojana (PMMY): The Pradhan Mantri Mudra Yojana, launched in 2015, aims to provide financial support to small and micro-enterprises. Micro Units Development Refinance Agency (MUDRA) banks offer startup loans up to INR 10 lakhs to non-corporate, non-farm small/micro-enterprises. The loans are categorized into Shishu, Kishore, and Tarun, depending on the funding requirements. As of March 2023, an impressive INR 23.2 lakh crore has been sanctioned in 40.82 crore loan accounts, reflecting the substantial impact of this scheme on small businesses.
- Chunauti: Chunauti, launched in August 2020, is a startup challenge initiative under the Next Generation Incubation Scheme (NGIS). It invites startups to develop solutions for challenges posed by the COVID-19 pandemic. With a budget of over INR 95 crores, Chunauti aims to identify and support approximately 300 startups in addressing pandemic-related problems. Selected startups receive incubation support, mentorship, funding, and cloud credits, fostering innovation during these challenging times.
- Qualcomm Semiconductor Mentorship Program: In collaboration with the Centre for Development of Advanced Computing (C-DAC), Qualcomm India launched the Qualcomm Semiconductor Mentorship Program (QSMP) in 2022. This program pairs Indian startups in the semiconductor sector with Qualcomm India leaders for mentorship, technical training, and industry outreach.
- Digital India Bhashini and GENESIS: Launched during the Digital India week in 2022, these schemes aim to boost Indian startups and provide easy access to digital services in vernacular languages. With a combined budget of approximately INR 750 crores, these initiatives focus on empowering national deep-tech startups.
- ATAL Innovation Mission: Established to promote innovation, research, and development, the Atal Innovation Mission (AIM) is a flagship initiative that seeks to create a platform for academics and innovators. AIM aims to build 10,000 Atal Tinkering Labs and 101 Atal Incubation Centers while sponsoring 200 businesses through the Atal New India Challenges.
- eBiz Portal: eBiz, the first electronic government-to-business portal, was founded in 2013 to streamline the business environment in India. It acts as a communication hub for investors and businesses, facilitating a conducive business environment.
- Dairy Processing and Infrastructure Development Fund (DIDF): Established under the National Bank for Agriculture and Rural Development (NABARD), DIDF aims to support dairy projects and rural enterprises. It offers loans to milk unions, cooperatives, and milk-producing companies, with the state government serving as a guarantor for repayment.
- Support for International Patent Protection in Electronics & Information Technology: This scheme, known as SIP-EIT, provides financial support for international patent filing in the Information Communication Technologies and Electronics sector. It reimburses a portion of the expenses incurred during patent application filing, encouraging innovation in these industries.
- Multiplier Grants Scheme (MGS): The Multiplier Grants Scheme encourages collaborative research and development between industry and academia. It provides financial support to expedite the development of innovative products and packages, benefiting entrepreneurs and startups.
- Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE): CGTMSE offers business loans to micro-level enterprises and startups without the need for collateral. It allows businesses to access loans at subsidized interest rates, promoting entrepreneurship and growth.
- Venture Capital Assistance Scheme (VCA): The VCA scheme, launched by the Small Farmer’s Agri-Business Consortium (SFAC), provides term loans to farmer-entrepreneurs for project implementation. It encourages the development of agri-business and agri-entrepreneurs.
- Extramural Research Funding Scheme: This scheme, implemented by the Science and Engineering Research Council (SERC), offers funding for basic research in various areas of science and engineering. It supports researchers and institutions in their pursuit of groundbreaking research.
- High Risk – High Reward Research: Aimed at encouraging high-risk, high-reward research projects, this scheme invites proposals with the potential to bring about paradigm shifts in science and technology. It provides funding for up to three to five years, facilitating innovation and groundbreaking discoveries.
- IREDA-NCEF Refinance Scheme: In collaboration with the Indian Renewable Energy Development Agency Ltd. (IREDA) and the National Clean Energy Fund (NCEF), this scheme aims to revive existing biomass power and small hydropower projects. It offers refinance at concessional interest rates, reducing the cost of funds for these projects.
- Dairy Entrepreneurship Development Scheme (DEDS): Implemented by the Department of Animal Husbandry, DEDS focuses on generating self-employment opportunities in the dairy sector. It supports activities related to milk production, procurement, transportation, processing, and marketing, providing capital subsidies for bankable projects.
- Drone Shakti: Launched in 2022, Drone Shakti encourages startups to develop various drone applications, including drones-as-a-service (DaaS). It promotes the use of drones in agriculture, land record digitization, and more. The government aims to strengthen the drone manufacturing industry in India by providing incentives and banning drone imports.
- Sub-Mission on Agricultural Mechanization (SMAM): SMAM, initiated in 2014-2015, aims to increase farm mechanization, particularly for small and marginal farmers. Recent updates include financial assistance for drones under SMAM, facilitating the adoption of modern farming practices.
These government schemes and initiatives demonstrate India’s commitment to fostering entrepreneurship, innovation, and economic growth. By providing financial support, mentorship, and infrastructure, the government is empowering startups and entrepreneurs to thrive in a competitive business landscape.
As India continues its journey towards becoming a global hub for innovation and entrepreneurship, these schemes play a pivotal role in shaping the nation’s economic future.
