16th January 2016 will be remembered as an important date in Indian history as on this day India witnessed a BIG CHANGE in the methods of doing business in the future under the guidance of Prime Minister Narendra Modi. Talks, articles and shows on start-ups have become common in India but not many are interested as the real job at ground zero is yet to happen. Last weekend can be termed as a starting point for The START UP INDIA MISSION as country’s biggest technology enabled startup conference (ACTION PLAN) was conducted and it was attended by the who’s who from the newest work industry (read startup) and tech. It ended with a note of action and tons of potential opportunities for the rising class of business people in India.
Few important things which were discussed are highlighted below-
Rs.10K crores from the government coming up-
The Indian government has decided to come up with an immediate corpus of Rs.2500 crore and has planned to invest a total of 10k crores in the next 4 year period. The entire amount will go into making a startup community which will be a PAN INDIA concept. Most importantly, the funding will be managed and supervised by a set of board members who will be selected from the private industries such as academics, manufacturing and industrial set-ups and successful startup owners.
This body will primly invest into startup businesses sectors like education, healthcare, agriculture and industry & manufacture.
Single window registration system for Startups-
India authorities are working upon a mobile app and a website (to be launched on 1st April 2016) which will enable registration of a startup within 24 hours. The website will help in activities like getting into contract, clearances, approvals and registration. A company may also apply for schemes under the Startup India Action Plan using the same portal.
No regulatory burdens, a self-certification will work-
This is an essential move as getting permission and not being able to work freely has been a long time hurdle. Indian government has planned a 9 point rule book based on the labor and environment aspects which will work as a self-certifying process. Startups will be allowed to rate themselves upon these pointers on the mobile app. Also there will not be any sort of inspection under the labor laws for the initial span of 3 years.
Fast-track patent application process-
India government has decided to bear all expenses on getting patents, designs and trademarks for a new startup business. This plan will also have an 80% refund in order to encourage the creation and pull in more innovative startup culture thinkers. This scheme is in place for limited 1 year duration for now.
Startups to get guarantee credit funding-
A special credit funding system will be in place to raise money in the form of debts from formal banking institutions in the country. This mechanism will work in coordination with National Credit Guarantee Trust Company (NCGTC) and SIDBI which will have a yearly corpus of Rs.500 crores for the coming 4 years.
NO TAXES for 3 years + capital gains-
In order to put startup companies on the profit track; they will be exempted of taxes for the first 3 years of their business. This will be provided only to companies which are subjected to non-distribution of dividends. Companies investing on venture capitals (VCs), alterative investment funds and SEBI programs will also be discounted of the taxes.
“#StartupIndia #actionplan had over 70,000 tweets & 14 articles posted over a span of half day during the event”
The Startup India Hub will be the powerhouse of the startup industry. Everything and everyone right from the Indian and international VCs, incubators, legal help, banks, angel investors, related universities and R&D firms will be available within the hub. This community epicenter will also have access to start and central governing bodies representing the department for immediate help along with the top players from the startup ecosystem who have made it big and can guide. This hub is ought to encourage participation, finance and coordination. This is also going to benefit the knowledge exchange practice in an unpredictable manner.
Norms for public procurement wiped off-
Both state and central will let off startups from the manufacturing category on the basis of their past experience/turnover. However, for this exemption the business must have owned manufacturing unit in India along with the adequate capacities in order to fulfill the given project requirements-especially the timely completion and delivery aspect.
Exists made simpler for Startups-
Just like the single window beginning system, startups now will be allowed to windup within a period of 90 days from the date of application for closure. This fast track winding up program for startups is supported by the much recently tabled insolvency and bankruptcy bill. The process will help achieve the voluntary closing of a business along with the limited liability concept.
ATAL innovation mission-
500 sector specific incubators will be setup in order to encourage entrepreneurship in India. This encouragement program for business and innovation is launched under the ATAL innovation mission which is a very important plan to develop new startups in India. Processes like pre-incubation training and seed funding will be a part of the teachings. A set of 3 state and union territory awards and 3 national awards will be presented annually along with a special award for Grand Innovation Challenge will be presented for the discovery of “low-cost” business solutions within the country.
Innovation programs for students at early age-
In order to push the concept of startup at an early age the government is bringing in investing whopping amount of 250 crores under the Uchatar Avishkar Yojana. This scheme is likely to give birth to top quality innovation from the field of information technology and other verticals too. This program is mainly concentrated within the school kids’ level and the idea is to generate 10 lakh innovative ideas from 5 lakh schools nationwide.
Talking of the annual grand challenge; it will also have something for the most innovative and active incubators in India. Going by the KPIs (key performance indicators); incubators having world class standards and potentials will be recognized and awarded Rs.10 crores each as a financial backup for revamping their infrastructure and implementation of their business plan.
The road for startups in India seems sturdy and long however never impossible- Hope it turns up well!!!