Union Cabinet nod for setting up `2k cr startup fund by next month
The Union Cabinet is expected to approve setting up of a Rs 2,000-crore credit guarantee fund by July-end with a view to provide funding facilities to startups, a top official said on Monday.
Department of Industrial Policy and Promotion (DIPP) Secretary Ramesh Abhishek said the fund would be used to lend to startups without any collateral.
He said that last week, the proposal was approved by the Finance Ministry.
Under this, Rs 2000 crore will be disbursed over a period of three years.
"One startup will get a maximum of Rs 5 crore. We are hoping to get the Cabinet approval on this by end of July to operationalise this fund," he said here during the launch of startup India hub portal.
He said that about 7,500 startups will benefited from this corpus and it will generate an additional funding of Rs 15,000 crore.
Since the launch of startup India action plan in January 2016, Abhishek said Rs 960 crore of funds were disbursed to different startups.
The DIPP has put 1,000 facilitators for intellectual property (IPR) related issues besides setting of 547 tinkering labs under Atal Innovation Mission.
"358 startups were facilitated for IPR, 1333 were recognised as startups, 39 startups were given income tax benefits and we are reviewing all other cases regard this.
"These numbers are going to multiply this year as we have changed the definition of startups," he said adding under the 'Fund of Funds' scheme, over Rs 1,100 crore were disbursed last fiscal.
This year, the DIPP has sought Rs 1,600 crore more from the finance ministry.
Talking about the startup India hub portal, he said this platform will help all the budding entrepreneurs who want to seek information related with government's scheme, about mentors, funders and accelerators.
Meanwhile, India is planning to organise a meet of startups of the South Asian region for exchange of new ideas and promoting interaction among them.
Commerce and Industry Minister Nirmala Sitharaman also sought views of Indian startups to hold this programme.
"I will be working towards having a SAARC (South Asian Association for Regional Cooperation) country meet for startups. There are so many complementarities among us in the South Asian region," she said while launching a startup India hub portal here.
She said the event can act as a platform for exchanging ideas, which can be mutually beneficial and can be worked out. She asked startups to give ideas about the people who can be invited for the meet.
If the ministry would get feedback and suggestions in the next couple of months, by December the meet can happen, in which SAARC country startups can come to India and share ideas.
SAARC members are Afghanistan, Bangladesh, Bhutan, India, Nepal, Maldives, Pakistan and Sri Lanka.
Further, to promote the startup ecosystem in the country, Sitharaman will write to all the Members of Parliament to help budding entrepreneurs.
Citing an example, the minister said she used her MP Local Area Development Scheme (MPLADS) fund to create a co- working space for startups in Mangalore.
"I will write to all the MPs...(particularly) in districts where people are approaching their MPs saying can we have some space and where there is a demand of startups," she added.
The ministry is also planning to work in certain districts to identify schools and help them qualify to get tinkering labs under the Atal Innovation Mission. She added that the ministry is working on modalities to facilitate exchange of ideas between startups of India and Germany.
The 'Startup India Virtual Hub' is an online platform for all stakeholders to discover, connect and engage with each other.
The minister said it is a part of an effort to create a marketplace where all the stakeholders can interact, exchange knowledge, and enable each other to grow.
It will streamline the life cycle of existing and potential startups, helping them access the right resources at right time.
The portal will host startups, investors, funds, mentors, academia, incubators, accelerators, corporates, government bodies and more.
The Hub attempts to solve the problem of information asymmetry and lack of access to knowledge, tools, experts, especially in the nascent ecosystems across Tier II and III towns. It would also facilitate learning & development, networking, mentorship and funding for startups.
According to the commerce ministry, India is the third largest startup ecosystem around the globe, with 3-4 startups commencing every day. In the next phase, the platform will aggregate schemes available across various state governments.