India, World’s youngest startup nation has once again received a major boost from the Government for encouraging startups. The Government is looking very positive about backing the startup sector of the company.
The Government wants to motivate young entrepreneurs to become job creators, instead of job seekers, Indian Govt. is again planning to increase startup fund by 5 times. It is a big move for Prime Minister Narendra Modi’s ambitious ‘Startup India’ initiative.
According to Ashutosh Sharma, secretary, department of science and technology (DST), in the 2016-17 financial year, it will provide seed capital to 50-80 new ventures with funding ranging from INR 50 lakh to INR 1 crore per company.
From INR 40 crore initially planned for startups, Govt. has now provisioned a budget of INR 200 crore which would be used for angel funding for new startups.
“Funding has always been a problem for start-ups. With the seed money, the start-ups can approach venture capitalists or other funding agencies,” said Ashutosh Sharma.
“Earlier, we would provide INR 10 lakh per startup but, this year, we have increased the funding substantially,” he added.
DST is a major funding agency for new ventures related to science and technology.
Referring to an internal study done by a consultancy firm on behalf of DST, Sharma said, “Over the last nine years, it has invested INR 200 crore in start-ups and its value had risen to INR 4,000 crore with 10,000 jobs, too, being created.”
The government will also open 25 new technology business incubators to provide relevant training. Incubators are a major source of funding to these new ventures.
As per their renewed focus on startups, some other major decisions were also taken:
- Budget of INR 10 crore created for establishing world class incubators in India
- 66% of the funds would be allocated for hardware and manufacturing startups; this is a good news for those entrepreneurs who are not focusing on IT or e-commerce
- 25 new Technology-focused incubators shall be created which will also provide advanced training to entrepreneurs
- is maturing in their assessment of entrepreneurs. As per Amitabh, Govt. doesn’t think that providing seed capital to startups is risky as PhD holders and Scientists are now approaching Govt. for getting funded
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