Prime Minister Modi has believed that the country's youth possess the ‘can do spirit’ and is the country's ‘can do generation’. The Amrit Peedhi has been entrusted with leading the country the Amrit Kaal and has been identified as one of the four pillars making the base of Viksit Bharat (developed India). The startup Josh in India is high as India adds four startups every hour, marking the highest rate globally.
Due to the impact of several government schemes, the country is witnessing a wave of entrepreneurial spirit today. In every household, regardless of status and background, people want to start businesses and establish their own companies. It has been established that innovation clubbed with a passion for problem-solving can create a startup ecosystem. India is the third-largest startup ecosystem in the world.
From a time when films only showed young people leaving their cushy jobs or those with trust funds dropping out of prestigious courses to start their venture, they now show ordinary people with little or no financial backing with a passion for solving a problem and starting their entrepreneurial journeys. With the government’s support, young entrepreneurs believe it only takes the drive and determination to start solving problems through their entrepreneurial ventures, and the government will support them. In the past, PM Modi lauded the effects of government schemes reaching far-flung corners of the country and marked January 16 as National Startup Day.
From Unicorns to Decacorns and Employment Generation
Since 2014, when there were just 350 startups in India recognised by the Department for the Promotion of Industry and Internal Trade (DPIIT), there are now 1.15 lakh startups registered (as of November 2023). India’s youth has shown the world the power of their ‘can do’ spirit by making India home to 1 out of 10 unicorns globally! Owing to schemes like Startup India and Stand-Up India, India’s startup journey has taken off. The country is home to over 100 unicorns, and 52% of these startups are from tier 2 and tier 3 cities. In 2022 alone, it saw the rise of 22 unicorns with a total valuation of $29.2 billion. The future for the country’s startups looks bright as more and more Indian unicorns are on their way to becoming decacorns (obtaining a valuation of $10 Billion).
Startups also significantly contribute to the country’s economy by providing direct and indirect employment. So far, Indian startups have generated over 10.34 lakh direct jobs and are driving employment expansion in sectors such as e-commerce, Fintech, Edtech, and health tech. These startups are instrumental in fostering the growth of gig economy employment opportunities.
Fostering Innovation in Several Sectors
PM Modi's impassioned plea to young minds can be encapsulated in his statement, “Don't just keep your dreams local, make them global. Remember this mantra- let's innovate for India, innovate from India”. Innovation in India is flourishing at a rapid pace. New markets emerge and bring endless opportunities, which the Indian youth quickly grab and succeed in. Resultantly, Indian startups are known to be solving problems in 56 diverse industrial sectors, with 13% from IT services, 9% from healthcare and life sciences, 7% from education, 5% from agriculture and 5% from food & beverages as of 2022.
Incubation platforms such as 10,000 Atal Tinkering Labs in schools enable young innovators to work on novel ideas. These labs serve as an institutional mechanism for removing hindrances for bright young minds and giving them a platform to test their ideas. 75 lakh students are actively associated with these labs, fostering creativity and innovation.
PM Modi has also commended a notable achievement in our progression towards an innovation-driven knowledge economy, with more than 41,000 patents granted in the fiscal year 2023-24.
Female Entrepreneurs on the Rise
To enhance financial support for women-led startups, the Fund of Funds for Startups Scheme operated by SIDBI has allocated 10% of its fund, amounting to Rs 1,000 crore, specifically for women-led ventures. This initiative aims to encourage the inflow of both equity and debt into startups led by women. Complementing this financial support, a Virtual Incubation Program for Women Entrepreneurs has been implemented. This program is designed to provide pro-bono acceleration support for three months to 20 women-led tech startups, further fostering their growth and development in the competitive startup landscape.
47% of startups in India have at least one woman director. As per findings from the Women's in India's Startup Ecosystem Report by WISER, the percentage of startups led by women in India has surged to 18% over the last five years. In 2017, 10% of the company was headed by female founders. In 2022, the proportion of women-led startups notably increased to 18%. The report also revealed that 17% of the 105 unicorns in 2022 are led by women.
Funding India’s Future: Support to Startups
Numerous initiatives, such as the Startup India Action Plan, have been pivotal in laying the groundwork for robust government support, schemes, and incentives. Additionally, the Credit Guarantee Scheme for Startups plays a crucial role by providing credit guarantees for loans extended to startups recognized by the Department for Promotion of Industry and Internal Trade (DPIIT) through Scheduled Commercial Banks, Non-Banking Financial Companies (NBFCs), and Venture Debt Funds (VDFs). Since 2016, the government has undertaken over 50 regulatory reforms, focusing on enhancing the ease of doing business, facilitating capital raising, and reducing compliance burdens within the startup ecosystem. The streamlining of procurement processes through the Government E-Marketplace, a 3-year income tax exemption, and the implementation of Start-ups Intellectual Property Protection further empower startups to file applications for patents, designs, and trademarks. The introduction of a fast-track mechanism for easy exits and initiatives connecting Indian startups with global players collectively exemplify the comprehensive measures aimed at nurturing the startup landscape. These concerted efforts have not only significantly assisted existing startups but have also been instrumental in fostering the growth of new startups across the country. By addressing various facets of the startup ecosystem, these measures contribute to an environment that encourages innovation, entrepreneurship, and global connectivity, thereby propelling India's standing as a thriving hub for startups.
