What Indian Startups Expect From the Government There is no denying the fact that Startup India and other such initiatives have given a huge boost to startups in the country

By Animesh Joshi

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India is undoubtedly one of the hottest markets for start-ups and its investors gave its growth potential. Recent reports conclude India as the 4th largest base for startups in the world and the nation currently has 26 unicorns (the third-highest in the world after the US and China) and many more are in the making — an indicator of how well its startups are doing. The number rose from ~7,000 startups in 2008 to over 49,000 start-ups in 2018 showing that Indian startup ecosystem has grown exponentially.

The Ecosystem

The positioning of India as a startup country is also thought of in the light of other famous startup scenes such as the US, Israel, Singapore. The growth of the scene should go as far as 2,000+ new startups created each year by 2020, and job creation from these entrepreneurs go from 65-75k as of today to 250-300k by 2020.

Of course, India is a continent in itself, and some 6 cities are trusting 90per cent of the technology scene. Bangalore(now Bengaluru) and the New Delhi area account for 28per cent and 24per cent of the startups in India, although emerging scenes pop up around the country, from Mumbai to Hyderabad, Pune or Chennai.

The Past

While the Indian startup ecosystem is blooming like never before, history was never the same. A decade ago, India was failing entrepreneurship, one startup at a time. The three crucial tangents that were a backbone of any successful startup ecosystem- government and policies; domestic consumption; and startup exits fuelled by acquisitive, local companies were struggling to keep up with the high. What triggered the slow decline of startups were grassroots-level corruption, apart from startups' self-inflicted ethical mess.

While major sectors such as e-commerce are worried about provisions in proposed laws and regulations, other entrepreneurs ranging from cryptocurrency to online pharma are concerned that a wave of legislation — some implemented and others at various stages of consideration — will trip up India's ascendant startup scene. The biggest setback that entrepreneurs are facing is the sudden and unpredictable nature of these government laws.

"A few months earlier, The All India Organisation of Chemists and Druggists (AIOCD) has opposed the government's decision of e-pharmacy regulation. As per these regulations, the e-pharmacies are given a set of regulations including data localisation and other sets of rules regarding registration.

In September last year, some 26,000 pharmacies in Bengaluru, India's startup capital, protested for the rise of online competition and new regulation that did little to safeguard their old-world businesses. These online ventures, they stated, have vested interests from this flimsy legislation that provided limited checks and balances and ignored unfair discounts offered by these e-pharmacies. While the law provides for a maximum of 16per cent discounts, these firms cut prices as much as 60per cent, they allege.

The Government Policies

Nothing, however, remains the same when it comes to the Indian government. In spite of the major setbacks that startups have to face due to unpredicted policies, the Narendra Modi led Government of India has been focusing more and more on a wide universe of emerging startups. The government has, in fact, come up with a number of new programmes and opportunities for bringing out the best in these companies and help them in innovation and nurturing.

Launched in 2016, the Startup India initiative promotes and assists entrepreneurship by mentoring, nurturing and facilitating startups throughout their life cycle.

Apart from the scheme "Fund of Funds' which helps startups in gaining access to funding, it supports with mechanisms that comprise of online recognition of startups, Startup India Learning Programme, Facilitated Patent filing, Easy Compliance Norms, Relaxed Procurement Norms, incubator support, innovation-focused programmes for students, funding support, tax benefits and addressing of regulatory issues.

The Atal Innovation Mission (AIM) is a solid platform for the promotion of world-class Innovation Hubs, Grand Challenges, start-up businesses and other self-employment activities, particularly in technology driven areas. The Digital India initiative works to promote India as a digitally-empowered society and knowledge economy with universal access to goods and services.

There is no denying the fact that Startup India and other such initiatives have given a huge boost to startups in the country. However, lack of awareness or problematic government assistance could prove to be a catastrophe for a startup. It could go from being glamorous to clamorous. knowledge, some updates, and a lot of passion could certainly change that. The Indian government has come up with more than 49 schemes for idea-stage, entrepreneurs /researchers, early-stage startups and growth-stage companies over a period of time and many of these were introduced before the launch of Startup India plan. But most of the entrepreneurs are either not aware of these different schemes or do not have a clear idea of how to avail them. Starting up a involves policy regulations and rules, taxations and turnaround time for registration and more and entrepreneurs need to have a clear understanding of these for their business to bloom.


Animesh Joshi

Co-Founder at Insino Ventures

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