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Startup India: Action Plan & Salient Features to Nurturing Innovation

An Action Plan for Startup India to build a strong eco-system to nurture Innovation and Startups in the country was launched on 16th January 2016. Salient Features of the scheme are as follow:

i. Simplification and Handholding

· Simple Compliance Regime for startups based on Self-certification
· Launch of Mobile app and Portal for compliance and information exchange
· Startup India Hub to handhold startups during various phases of their development
· Legal support and fast-tracking patent examination at reduced costs
· Relaxed norms of public procurement for startups
· Faster exit for startups

a. Funding support and Incentives
· Providing funding support through a Fund of Funds with a corpus of Rupees 10,000 crore
· Credit guarantee fund for startups
· Tax exemption on capital gains invested in Fund of Funds
· Tax exemption to startups for 3 years

b. Industry-Academia Partnership and Incubation
· Organizing Startup Fests to showcase innovations and providing collaboration platforms
· Launch of Atal Innovation Mission (AIM) with Self –Employment and Talent Utilization (SETU) Program of NITI Aayog
· Harnessing private Sector expertise for setting up incubators
· Setting up of 7 new research parks modeled on the Research Park at IIT Madras
· Launching of innovation focused programs for students.
· Annual Incubator Grand Challenge to promote good practices among incubators.

ii. Credit Guarantee Fund
The Initiative provides for creating a credit guarantee fund for startups through National Guarantee Trust Company (NCGTC)/SIDBI with a Corpus of Rs.500 crore per year for the next four years.

With this Action Plan the Government hopes to accelerate spreading of the startup movement:

From digital/Technology Sector to a wide array of sectors including agriculture, manufacturing, social sector, Healthcare, education, etc; and

From existing tier 1 cities to tier 2 and tier 3 cities including semi-urban and rural areas.

The Action Plan envisages setting up of 7 New Research Parks modeled on the Research Park at IIT Madras at IITs in Guwahati, Hyderabad, Kanpur, Kharagpur, Bangalore, Gandhinagar and Delhi and setting-up/scaling-up of 18 Technology business Incubators (TBI) at NITs/IITs/IIMs etc. as per the funding model of DST.