The Human Resource Development Ministry and the Department of Science and Technology have agreed to partner in an initiative to set up over 75 startup support hubs in the National Institutes of Technology (NITs), the Indian Institutes of Information Technology (IIITs), the Indian Institutes of Science Education and Research (IISERs) and NIPERs or National Institutes of Pharmaceutical Education and Research.
“From about 70 incubators set up by the government between 2001 and 2014, we have now crossed 100 incubators. About 90 of these are in educational institutions, with virtually all the old IITs and IIMs covered,” said Harkesh Mittal, adviser and head of the National Science and Technology Entrepreneurship Development Board.
Steady climb
“The number of IIT/IIM graduates looking to start their own ventures has gone from two per cent a few years ago to nearly 10 per cent now, but we need to take this movement to our other educational institutions as well,” Mr. Mittal told The Hindu .
As per the plan, the HRD Ministry and the Science and Technology Ministry would share the costs for setting up startup centres in these institutions, which would need around 5,000 square feet space and cost around Rs. 50 lakh a year.
The Start Up India mission to be unveiled on Saturday envisages technology business incubators and research parks. The Science and Technology Ministry would bear 100 per cent cost to set up business incubators in institutes like NITs. Each incubator would work with 20 budding ventures, and be spread over 10,000 sq.ft. The cost of each incubator is expected to be in the range of Rs. 5 crore to Rs. 10 crore. Separately, research parks like the one at IIT Madras would be set up in a handful of institutes at a cost of Rs. 70 crore to Rs. 100 crore each.
Startups for tax breaks, single window system
Simplified tax structure, easy compliance process and single window system are some of the issues that startups expect to be addressed through the much-awaited ‘Startup India’ policy to be uveiled by Prime Minister Narendra Modi on Saturday.
“Ease of doing business is important for any enterprise but critical for startups. With limited resources at their command, they cannot afford to spend too much time, money and effort in navigating a complex environment, populated by archaic laws and a labyrinth of registrations, permits and approvals,” Kunal Bahl, Co-founder and CEO, Snapdeal, said.
Saturday’s announcement is expected to mark the next phase of growth for entrepreneurship and startups in India. With 4,200 enterprises, India already ranks third in the world for the number of start ups after the U.S. and the U.K. With three to four startups emerging every day, this number is expected to reach several thousand by 2020.
Silicon Valley-based Karl Mehta, Founder of EdCast, who is slated to speak at the event on January 16, said India is at an inflection point and needs the talent, energy and dedication of entrepreneurs to fulfil its potential to become a developed nation in the next decade. “I think the event on January 16, will give strategic direction for startups in India,” he said.
About India becoming a preferred destination rather than Silicon Valley for entrepreneurs like him, he said, “The internet has united the world and opportunities are available in every part of the world today. I do agree that Silicon Valley is a global brand for “technology and innovation.” However, such hubs can come up all over the world, wherever there is passion, capital and technology.”
Mr. Mehta, who sold his third startup, Playspan, to VISA in 2011 said, all entrepreneurs look for single window clearances, ease of doing business, incentives to develop regions and clarity on taxation structures.
Mr. Bahl of Snapdeal said in India it takes 29 days to start a business, it takes half a day in New Zealand. Likewise, when it comes to bankruptcy, the complete filing process takes approximately 4.3 years in India as compared to only 0.8 years in Singapore.
“The problem in most cases is not the regulation but the red tape that makes compliance difficult despite best intentions. Many start-ups begin their journey here in India but quickly move abroad as they are intimidated by the complexity of regulation in India,” he added.
Saurabh Arora, CEO of a healthcare startup, pointed out to the need for creating a one-window system for startups for anything related to their business while Vir Kashyap, Co-Founder and Chief Operating Officer (COO) at Babajob.com said easing restrictions on SMS and VoIP would enable startups to communicate with their users far more efficiently.
The criteria to qualify for angel funding are stringent, according to Nilotpal Chakravarti, AVP at IAMAI and need to be eased. “In fact, there should be tax breaks and incentives for individuals supporting start-ups with capital. Meanwhile, Innefu Labs’ Co-Founder, Tarun Wig, believes India needs to realise importance of innovation in cyber security landscape and follow the example of the U.S. which has established In-Q-Tel and a CIA-funded venture capital firm to invest in technology startups.
Puja Bansal, Founder and Director, Myheera.com said to create an environment that is conducive for growth of startups, the government needs to enable easy availability of loans.
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