Startup India – Action Plan
Addressing the first conference of start-up entrepreneurs, PM Modi announced an action plan to boost such ventures which are seen as key to employment generation and wealth creation.
Here are the top takeaways from the Prime Minister’s speech:
1. Compliance regime based on self certification
To reduce the regulatory burden on Startups thereby keeping compliance cost low. This self-certification will apply to laws like payment of gratuity, contract labor, employees provident fund, water and air pollution acts.
2. Startup India hub
A startup India hub will be created as a single point of contact for the entire startup ecosystem to enable knowledge exchange and access to funding.
3. Simplifying the startup process
A startup will be to able to set up by just filling up a short form through a mobile app and online portal. A mobile app will be launched on April 1 through which startups can be registered in a day. There will also be a portal for clearances, approvals and registrations.
4. Patent protection
The government is also working on a legal support for fast-tracking patent examination at lower costs. It will promote awareness and adoption of Intellectual Property Rights (IPRs) by startups and help them protect and commercialize IPRs.
5. Funds of funds with a corpus of Rs 10,000 crore
In order to provide funding support to startups, the government will set up a fund with an initial corpus of Rs 2,500 crore and a total corpus of Rs 10,000 crore over four years. The fund would be managed by private professionals drawn from the industry while LIC will be a co-investor in the fund.
6. Credit Guarantee Fund
A National Credit Guarantee Trust Company is being envisaged with a budgetary allocation of Rs 500 crore per year for the next four years.
7. Exemption from Capital Gains Tax
Currently, investments by venture capital funds in startups are exempt from this law. Now, the same is being extended to investments made by incubators in startups.
8. Tax exemption for startups
Income tax exemption to startups announced for three years
9. Tax exemption on investments above Fair Market Value
Due to their high risk nature, Startups are not able to attract investment in their initial stage. It is therefore important that suitable incentives are provided to investors for investing in the Startup ecosystem.
10. Startup fests
Innovation core programs for students in 5 lakh schools. There will also be an annual incubator grand challenge to create world class incubators
11. Launch of Atal Innovation Mission
Atal Innovation Mission started to give an impetus to innovation and encourage the talent among the people
12. Setting up of 35 new incubators in institutions
PPP model being considered for 35 new incubators, 31 innovation centres at national institutes
13. Setting up of 7 new research parks
Government shall set up seven new research parks – six in IITs, one in IISc with an initial investment of Rs 100 crore each.
14. Promote entrepreneurship in biotechnology
Five new bio clusters, 50 new bio incubators, 150 technology transfer offices and 20 bio connect offices will be established.
15. Innovation focused programmes for students
There will be innovation core programs for students in 5 lakh schools.
16. Panel of facilitators to provide legal support and assist in filing of patent application
17. 80 per cent rebate on filing patent applications by startups
18. Relaxed norms of public procurement for startups
19. Faster exits for startups