Blog

The startups recognised by the Department for Promotion of Industry and Internal Trade (DPIIT) 

employed 7.68 Lakh people across the country as on June 30, 2022, the government informed the Parliament on Monday (July 18).

As per the data presented by Minister of State for Skill Development and Entrepreneurship Rajeev Chandrasekhar in Lok Sabha, the startups produced the highest number of jobs in Maharashtra (1,46,132), followed by  Karnataka (1,03,541) and Delhi (87,643).

Responding to a question about the schemes for startups, the minister said that the DPIIT has implemented the Fund of Funds for Startups (FFS) scheme and Startup India Seed Fund (SISF) scheme to provide financial assistance to startups via AIFs and incubators, respectively. 

“The government has established FFS with corpus of INR 10,000 crore, to meet the funding needs of startups, to be provided over the 14th and 15th Finance Commission cycles based on progress of the scheme and availability of funds,” Chandrasekhar said.

Talking about the SISF Scheme, he said that INR 945 Cr has been sanctioned under the scheme for a period of four years starting from 2021-22. 

Meanwhile, he also informed that the Centre has not fixed any target to give tax concessions for Indian startups. However, tax concessions are being provided to the startups under the Indian Income-Tax Act, 1961, he added.

Under the I-T Act, the Centre provides a 100% profit-linked deduction to startups for a consecutive three years if their turnover does not exceed over INR 100 Cr. Furthermore, employees of such startups are offered relaxation on TDS deduction pertaining to ESOPs. 

The Centre has also exempted capital gains arising from the sale of residential property to Indian startups having a turnover less than INR 100 Cr. Besides, it has exempted taxes on startups if their shares are issued at a higher price than the estimated market value. 

Additionally, the Centre has established a startup cell to address grievances and other tax-related issues of startups, the minister said. 

The Centre, along with state governments, has been focusing on improving the ease of doing business and building startup ecosystems across the country to create jobs and drive economic growth.

Earlier this month, DPIIT said that India has 73,205 recognised startups that generate 11 jobs on an average for Indian youth. Of these, over 45% startups have at least one woman director. 

These startups are mostly based in Tier-2, 3 cities of India. Maharashtra has the highest number of government-recognised startups at 13,541, followed by Karnataka and Delhi at 8,902 and 8,670, respectively.

India currently has 105 unicorn startups, with 5th generation Layer-1 (L1) blockchain network 5ire becoming the latest to enter the coveted club.