The ministry of commerce and industry said in a statement on 26 February that the Department for Promotion of Industry and Internal Trade (DPIIT) and digital payments company Paytm have inked a memorandum of understanding (MoU) to promote innovation and quicken the expansion of fintech and manufacturing startups in India. Paytm will provide businesses with market access, financial opportunities, infrastructure support, and mentorship as part of the relationship.
According to the press announcement, the partnership’s goal is to assist fintech hardware entrepreneurs in developing and scaling payment and financial technology solutions by providing them with innovation assistance and mentorship. Through workshops and guidelines developed in partnership with government and industry entities, it will also offer regulatory and compliance support.
Offerings of the MoU
Through the partnership’s infrastructure and market access support, businesses may take advantage of Paytm‘s vast merchant network to test, validate, and improve their solutions. In front of senior representatives from both organisations, DPIIT Director Sumeet Kumar Jarangal and Paytm Founder and CEO Vijay Shekhar Sharma signed the Memorandum of Understanding. This collaboration with Paytm is an important step in bolstering India’s startup environment, according to DPIIT Joint Secretary Sanjiv. DPIIT wants to help entrepreneurs overcome obstacles, scale their businesses, and help India become a worldwide innovation hub by utilising Paytm’s fintech infrastructure and skills.
Paytm for Startups Initiative
Paytm will introduce specific programs to assist fintech hardware manufacturers, such as Soundbox and PoS/EDC device makers, in expanding effectively as part of its Paytm for Startups effort. Mentorship programs, financial access via investor connections and incubation programs, regulatory guidance through industry-focused workshops, and recurring tracking and effect evaluations are all part of the projects.
The Paytm Foundation will fund deep-tech startups in the fields of Mobility, agritech, Web3, and Climate Technology through its CSR division. According to Vijay Shekhar Sharma, the current period is the optimal moment for startups to begin and expand under the leadership of Prime Minister Narendra Modi. Paytm is dedicated to enabling business owners by providing access to state-of-the-art technology, financial support, and mentorship. Through this partnership, the company will guarantee that startups have the resources they need to thrive from the ground up.
Financial Dynamics of Paytm
Thanks to the rebound in its digital payments sector, the fintech giant reduced its consolidated net loss from INR 221.7 Cr in the December quarter of Q3 FY25 to INR 208.5 Cr, a 6% decrease. Additionally, Paytm’s operating revenue decreased 36% from INR 2,850.5 Cr in Q3 FY24 to INR 1,827.8 Cr in the reviewed quarter.
Nevertheless, Vijay Shekhar Sharma, Founder and CEO, stated that the fintech company is on course to achieve profitability in the upcoming quarter (Q1 FY26) in accordance with the management’s expectations. Additionally, Paytm CFO Madhur Deora stated on the Q3 FY25 earnings call that the business anticipates becoming profitable on an adjusted EBITDA basis within a quarter or two.
This year, India marks nine years of Startup India, a transformative journey that began in 2016. National Startup Day honours how entrepreneurs and startups are reshaping economies and societies. It celebrates creativity, tenacity, and innovation while emphasising the role that entrepreneurs play in advancing technology and environmentally friendly solutions. The day also highlights how crucial it is to create an environment that supports audacious ideas and gives business owners the confidence to question the status quo and create the future.
What DPIIT’s Official Data Reveals?
As of January 15, 2025, the Department for Promotion of Industry and Internal Trade (DPIIT) had recognised over 1.59 lakh firms, solidifying India’s position as the world’s third-largest startup ecosystem. Over 100 unicorns power this thriving ecosystem, which is redefining entrepreneurship and innovation globally. This change has been driven by major cities like Bengaluru, Hyderabad, Mumbai, and Delhi-NCR, but smaller cities have also been making a greater contribution to the country’s entrepreneurial spirit.
Fintech, edtech, healthtech, and e-commerce startups have overcome regional obstacles and achieved international acclaim. India’s transition from job seekers to employment creators is exemplified by companies like Zomato, Nykaa, and Ola, which propel economic growth.
The Main Pockets of Startup Sector
According to DPIIT data, non-metropolitan areas account for more than half (51%) of India’s DPIIT-registered companies. An encouraging indication of India’s entrepreneurial potential is the growing number of businesses originating from non-metropolitan areas. Cities such as Jaipur, Indore, Coimbatore, Vadodara, and Surat provide entrepreneurs with affordable talent and growth prospects. In the meanwhile, companies receive substantial help from government-led incubator programs like Telangana’s T-Hub, which unlocks trillions of dollars in value and transforms India’s entrepreneurial scene. From 2014 to 2024, all of these emerging businesses have raised about $158 billion in capital.
Jobs Generation
By creating more than 16.6 lakh direct jobs in a variety of industries as of October 31, 2024, DPIIT-recognised startups have made a substantial contribution to the creation of jobs. With 2.04 lakh jobs, the IT services sector is the largest, followed by healthcare and life sciences (1.47 lakh) and professional and commercial services (about 94,000). These contributions demonstrate how startups propel economic expansion and generate a wide range of job possibilities across sectors.
A number of flagship programs have been introduced by the Startup India initiative to offer entrepreneurs all-encompassing assistance at various phases of their development. In order to ensure the expansion and viability of startups, these programs seek to solve important issues like funding, market access, and credit guarantees.
Startup India Seed Fund Scheme (SISFS)
With a capital of INR 945 crore, SISFS was established with the goal of giving entrepreneurs financial support for proof of concept, prototype development, product trials, market entry, and commercialisation during a four-year period beginning in 2021–2022. This would allow these firms to advance to a point where they can look for loans from commercial banks or other financial institutions, or raise money from venture capitalists or angel investors.
Credit Guarantee Scheme for Startups (CGSS)
The goal of the Credit Guarantee Scheme for Startups (CGSS) is to offer a credit guarantee up to a predetermined amount against loans made by Member Institutions (MIs) to finance qualified borrowers, or startups, as defined in the Department for Promotion of Industry and Internal Trade’s (DPIIT) periodically amended Gazette Notification.
Fund of Funds for Startups (FFS) Scheme
In accordance with the Start-up India Action Plan, the Prime Minister introduced FFS on January 16, 2016. A corpus of INR 10,000 crore has been granted for contributions to different Alternative Investment Funds (AIFs) that are SEBI-registered. FFS was established with the specific goal of assisting the growth and development of innovation-driven businesses. It does this by facilitating start-ups’ finance needs through participation in SEBI-registered Alternative Investment Fund funds.
Sates Realising the Power of Startups
The push for local entrepreneurs by the federal and state governments goes well beyond statistics and lofty discourse. A growing number of states increasingly see startups as a means of boosting demand and creating jobs. In 2016, for example, only four states had specific startup policies. This figure, which has now increased to 31 states and union territories (UTs), provides insight into how startups have gained popularity with influential decision-makers and oversight organisations. In addition to promoting policies, the Centre has onboarded numerous startups on sites such as the Government e-Marketplace (GeM) to expedite its procurement process and provide them with a platform to market their products directly to customers without the need for intermediaries. According to the DPIIT, as of October 2024, 27,208 of the 1.59 lakh certified firms had listed on GeM and fulfilled 3.53 lakh orders of INR 30,825 Cr.
BHASKAR: Strengthening the Startup Ecosystem in India
The Bharat Startup Knowledge Access Registry (BHASKAR) platform was introduced by the Department for Promotion of Industry and Internal Trade (DPIIT) in September 2024, in addition to the previously listed programs. The goal of this innovative project, which is a component of Startup India, is to centralise and simplify interactions within the Indian entrepreneurial ecosystem. In line with India’s goal of becoming a global leader in entrepreneurship, BHASKAR seeks to promote innovation, cooperation, and growth by bringing together startups, investors, mentors, service providers, and governmental organisations.
Startup Mahakumbh: Promoting Creativity
As a premier event, the Startup Mahakumbh unites investors, industry leaders, ecosystem players, startups, unicorns, and soonicorns. It promotes discussion to fortify the country’s startup ecosystem while showcasing India’s technological potential and entrepreneurial spirit.
With over 1,300 exhibitors spread across ten themed pavilions, the inaugural event in 2024 set an impressive example. Attracting a remarkable number of over 48,000 business travellers, it developed into a flourishing centre for innovative concepts and significant collaborations. With the theme “Startup India @ 2047—Unfolding the Bharat Story,” the second edition, which is slated to take place at Bharat Mandapam in New Delhi from April 3–5, 2025, is expected to surpass expectations. As India moves closer to being a global centre of innovation by 2047, this ambitious theme seeks to examine the future of the startup ecosystem in that country.
As India commemorates the ninth anniversary of the Startup India initiative, the nation’s entrepreneurial scene has seen a notable transition. With more than 1.59 lakh businesses recognised by DPIIT and an expanding workforce, India has solidified its position as a global centre for entrepreneurship and innovation. Through flagship programs, capacity-building initiatives, platforms like BHASKAR, and events like Startup Mahakumbh, the initiative has empowered companies in non-metropolitan areas as well as other sectors. An inclusive and dynamic entrepreneurial ecosystem is fostered by the Startup India program, which continues to be a major driver of economic growth as India moves closer to becoming a global leader in innovation.
In an effort to further promote the third-largest startup ecosystem globally, the recently established Startup Policy Forum (SPF) has partnered with the Department for Promotion of Industry and Internal Trade (DPIIT). Through this partnership, the two organisations hope to increase manufacturing capacity in India, promote innovation, accelerate technology adoption, and strengthen linkages with global stakeholders and ecosystem enablers. SPF and DPIIT announced in a joint statement that they will be creating specialist immersion programs aimed at introducing international investors to India’s thriving startup scene. Additionally, as part of the cooperation, the two organisations will work together to facilitate a startup debate called SPF Startup Baithak. As part of National Startup Week, the event is scheduled for January 15–16, 2025, at Delhi’s Bharat Mandapam.
SPF Startup Baithak
“The SPF Baithak will be a platform for new collaborations, global investor engagement, and to showcase the innovations within the Indian startup ecosystem,” said Sanjiv, joint secretary of DPIIT, in a LinkedIn post. This strategic partnership with SPF demonstrates DPIIT’s unwavering dedication to fostering an environment that is conducive to startups’ growth and allows them to significantly contribute to India’s goal of being a worldwide centre for innovation. In his remarks about the alliance, Sanjiv stated that the SPF members embody the spirit of entrepreneurship in India and that their involvement in this mission will be essential to reaching the objective of building India by 2047.
In order to close the gap between founders, legislators, and regulators, former Peak XV chief public policy and communications officer Shweta Rajpal Kohli founded SPF in December 2024. It seeks to assist the government’s efforts to put Indian startups on the international scene. Among its members are prominent startups such as Razorpay, CRED, Groww, Zerodha, Pine Labs, OYO, Acko, Swiggy, Dream11, Mobile Premier League (MPL), Livspace, Cars24, Cardekho, and Mobikwik.
Central Government Backing the Startup Culture
DPIIT and SPF’s common goal of creating a robust and prosperous startup ecosystem is demonstrated by this partnership. According to Kohli, the partnership with DPIIT aims to help entrepreneurs to realise their full potential and place India prominently on the global innovation map by creating effective collaborations. The collaboration coincides with the central government’s continuous initiative to support the domestic new-age technology sector. The DPIIT has collaborated with businesses such as HCLSoftware, Flipkart, bOAt, and Tally in recent months. The second annual Startup Mahakumbh event is now scheduled to take place at Bharat Mandapam from April 4–6, 2025.
The Ministry of Commerce & Industry said on 25 December that over 73,000 Indian enterprises had at least one female director, as certified under the Startup India initiative. In a statement, the ministry emphasised that this amounts to almost half of the 157,066 businesses that the government has funded, highlighting the critical role that women play in fostering innovation and economic expansion. India is now the third-largest startup hub in the world and boasts one of the most thriving startup ecosystems.
The Indian startup scene is influencing the direction of innovation and entrepreneurship with more than 100 unicorns. Over the past ten years, there has been a paradigm shift in India’s entrepreneurial mentality. Innovation hubs have emerged in cities like Bengaluru, Hyderabad, Mumbai, and Delhi-NCR.The expansion of startups in a variety of industries, such as fintech, edtech, healthtech, and e-commerce, has been spurred by the broad availability of reasonably priced internet and a youthful and vibrant workforce.
Indian Startup Ecosystem Report
Startup India’s “Indian Startup Ecosystem Report” claims that Indian startups have used cutting-edge technologies like blockchain, IoT, and artificial intelligence (AI) to solve regional and worldwide problems.With the help of incubators, accelerators, and strong mentorship networks, this innovative culture has created a special ecosystem that links innovative solutions with problems at the local level.The Indian government has launched a number of programs to encourage and foster entrepreneurship in recognition of the revolutionary potential of startups.
The foundation of this endeavour has been the flagship Startup India program, which was introduced in 2016. The Department for Promotion of Industry and Internal Trade (DPIIT) has recognised 157,066 startups as of December 25, 2024, and 759,303 people have registered on the portal.Through sector-specific laws, tax breaks, capital assistance, ease of doing business, and the Bharat Startup Knowledge Access Registry (BHASKAR) platform, the government has started aggressive initiatives to help the startup ecosystem.
Other Initiatives Backing Startup Culture
Infrastructure and funding are made available to innovators through programs like the National Initiative for Developing and Harnessing Innovations (NIDHI) and the Atal Innovation Mission (AIM). With an investment of INR 99 crore, the Startup Accelerator of MeitY for Product Innovation, Development, and Growth (SAMRIDH) program was introduced in 2021 with the goal of assisting 300 software product startups over the course of four years. The program offers accelerators up to INR 40 lakh in funding per startup to help them grow their businesses.
The ministry praised the achievements of cutting-edge businesses like BYJU’S, Zomato, Ola, and Nykaa, pointing out that these startups have grown internationally and demonstrated India’s capacity to grow and compete on a global scale.”India’s global influence is further demonstrated by the success of Indian-origin startups in Silicon Valley,” the ministry continued. Indian startups are increasingly exploring foreign markets and collaborating with multinational corporations, according to the Startup India International Guide. According to the government, comparable ideas around the world are being inspired by India’s leadership in providing inexpensive technology solutions, such as Aadhaar-enabled services and UPI.
The Ministry of Commerce & Industry also discovered that India’s unicorns are outperforming their international counterparts in terms of valuation growth, demonstrating the stability and scalability of the ecosystem’s basis.
According to the state government, Tamil Nadu has achieved a noteworthy milestone by registering more than 10,000 startups with the Department for Promotion of Industry and Internal Trade (DPIIT). The increase in registrations demonstrates the expansion of the startup ecosystem in the state, which has advanced significantly in the previous three years.
Quick Increase in the Number of Startups
In Tamil Nadu, there are now over 10,000 DPIIT-registered startups, up from 2,300 in March 2021. The state’s startup support agency, StartupTN, has been credited with spearheading programs that have contributed to this quick expansion.
The ecosystem has advanced thanks in large part to StartupTN’s numerous initiatives, which include funding support, mentorship opportunities, and incubation facilities. The CEO and Mission Director of StartupTN, Shivaraja Ramanathan, underlined the value of regional centres in the state. With nine regional hubs and one metro centre in Chennai, Tamil Nadu presently offers entrepreneurs the necessary infrastructure.
Emphasis on Assisting Entrepreneurs
To encourage entrepreneurship, especially among young people, the state government has taken proactive measures. StartupTN programs are designed to support young entrepreneurs and give them the tools they need to expand their companies. Ramanathan noted that, with state assistance, the organisation has concentrated on fostering an innovative culture.
About DPIIT
In India, the Department for Promotion of Industry and Internal Trade (DPIIT), a division of the Ministry of Commerce and Industry, is in charge of creating and carrying out developmental and promotional policies to support the expansion of the industrial sector while taking socioeconomic goals and national priorities into consideration. It significantly influences the framework of industrial policy, facilitates corporate transactions, and increases trade and investment in the nation.
DPIIT is responsible for developing and overseeing industrial development policies. To guarantee the successful execution of these programs, it collaborates with state governments and other ministries. By emphasising modernisation, technological advancement, and luring both domestic and foreign investment, the department aims to foster an atmosphere that supports industrial progress.
Startups recognised under DPIIT enjoy a number of advantages, including faster compliance, IPR fast-tracking, and access to several tax perks. The primary goal of the Startup India project is to assist startups in expanding their core businesses while lowering the regulatory load on them through low-cost compliance.
The DPIIT also promotes technical innovation and the defence of intellectual property rights. Government programs can be a strategic advantage for companies aiming to modernise or grow. To finance these projects, entrepreneurs can also look into business loans, since DPIIT-backed firms frequently enjoy easier compliance and easier access to funding, including loans tailored to MSME requirements.
To support manufacturing startups, the Department for Promotion of Industry and Internal Trade (DPIIT) has partnered with SaaS giant Tally Solutions and HDFC Bank by signing a memorandum of understanding (MoU). Tally will provide training, case studies, and expert-led sessions to assist the chosen new-age tech companies in streamlining operations, implementing scalable business practices, and addressing startup challenges in areas like financial management, compliance, marketing, and digitisation, according to a statement from DPIIT.
Along with networking possibilities with colleagues and mentors in the sector, the SaaS platform will also provide users with free one-year rental licenses of Tally Prime software. Speaking about the collaboration, DPIIT joint secretary Sanjiv Singh stated that it will provide entrepreneurs with in-depth knowledge and useful resources to help them deal with the intricacies of markets. Tally is committed to providing business owners with the information, resources, and technology they need to expand their enterprises. Tally Solutions’ managing director, Tejas Goenka, remarked, “Tally is proud to partner with DPIIT to support entrepreneurs in their journey. Their efforts to support this ecosystem have been incredible.”
Joining Hands With HDFC
Additionally, DPIIT signed a Memorandum of Understanding with HDFC Bank, which would provide “customised” banking and financial products for domestic startups as part of the new partnership. To further improve the start-up scene in India, HDFC is happy to partner with DPIIT. According to Sunali Rohra, head of startups and gig banking at HDFC Bank, DPIIT-supported start-ups will easily access the bank’s tailored range of products designed to help speed their growth. The flurry of collaborations comes only a day after Kotak Mahindra Bank joined forces with incubators IIMA Ventures, NSRCEL, and T-Hub to launch the Kotak BizLabs accelerator program to support early-stage entrepreneurs.
The chosen entrepreneurs from industries like agritech, climate tech, fintech, edtech, healthcare, and sustainability will get mentorship, thematic workshops, and “guaranteed” seed investment from Kotak BizLabs as part of this initiative.
DPIIT’s Slew of Partnerships to Further Support Startup Ecosystem
However, in an effort to support the domestic startup scene, DPIIT has recently signed a number of collaborations. The department partnered with e-commerce giant Flipkart earlier this month to support and guide emerging businesses. Before that, DPIIT had collaborated with Moglix, a B2B e-commerce platform, to provide manufacturing firms with assistance. The government also partnered with HCLSoftware in October to advance its manufacturing incubation program.
On December 17, the government told the Parliament that more than 1.63 lakh direct jobs had been created in Bengaluru by more than 13,000 startups approved by the Department for Promotion of Industry and Internal Trade (DPIIT). In response to a question in the Lok Sabha, Jitin Prasada, the Minister of State for Commerce and Industry, revealed the information. The minister stated, “As of October 31, 2024, the DPIIT has identified 13,649 entities as startups in the Bengaluru district (Rural and Urban), which have reportedly created over 163,345 direct jobs.”
He went on to say that the following significant government programmes have provided financial support to these startups: SISFS, or Startup India Seed Fund Scheme: 281 businesses have received approval of INR 63.99 Cr under SISFS to boost their early-stage development. Through SEBI-registered alternative investment funds, the Fund of Funds for firms (FFS), which is overseen by SIDBI, has enabled investments of INR 6,470.8 Cr into 346 firms. Launched as a pilot program in April 2023, the Credit Guarantee Scheme for businesses (CGSS) has given 24 businesses in the Bengaluru urban district INR 49.24 Cr in loans without collateral.
Tax Exemptions to Further Strengthen Startups Growth
The Income Tax Act’s tax concessions have also helped Bengaluru entrepreneurs. 1,601 businesses obtained exemptions under Section 56(2)(viib), and 348 companies obtained certificates of eligibility under Section 80-IAC. In order to encourage innovation and entrepreneurship in India, the government started the “Startup India” initiative in 2016 and offers financial assistance, tax breaks, and streamlined procedures to new companies.
Bharat Startup Knowledge Access Registry
In order to support the expansion of the Indian startup ecosystem, the government most recently introduced the Bharat Startup Knowledge Access Registry (BHASKAR), a digital platform for startups. The platform, which was created internally by the DPIIT as part of the “Startup India” initiative, is intended to help companies, investors, mentors, tech enablers, government agencies, and other important players in the Indian startup scene work together. The Centre just launched its second startup registry, BHASKAR. The Bharat Startup Ecosystem Registry was piloted by the Ministry of Commerce in February. The register was established to exhibit innovation, technology, and entrepreneurship by uniting all the players in the startup ecosystem.
About DPIIT
Established in 1995, the Department for Promotion of Industry and Internal Trade amalgamated with the Department of Industrial Development in 2000. It operates under the auspices of the Indian government’s Ministry of Commerce and Industry. This department is in charge of creating and carrying out developmental and promotional strategies to support the expansion of the industrial sector while taking into account the socioeconomic goals and national priorities.
E-commerce giant Flipkart has teamed up with the Department for Promotion of Industry and Internal Trade (DPIIT) to invest in and coach up-and-coming entrepreneurs in the nation in an effort to support the domestic startup ecosystem. Flipkart will support early-stage entrepreneurs through Flipkart Leap and Ventures, its startup accelerator, in accordance with the memorandum of understanding (MoU) that the two parties signed. Through the accelerator, the Walmart-backed company provides seed funding to Series A startups, with cheque sizes ranging from $200K to $500K. According to a statement from the e-commerce giant, Flipkart will also assist the up-and-coming businesses with the development of their prototypes and with entering foreign markets by offering infrastructure support.
Flipkart Claims To Have Supported 20 Startups Till Now
The organisation claims to have sponsored 20 startups through its accelerator since its founding in 2022, while it did not specify how many startups it plans to back. It has made investments in a number of firms, including FlexiflyMe, Dopplr, and NeuroPixel.AI. The accelerator fund has a $100 million size. According to Rajneesh Kumar, chief corporate affairs officer at Flipkart, the company hopes to use its $100 million venture fund to help entrepreneurs make ground-breaking discoveries that will influence technology and business in India and beyond.
In contrast, the DPIIT will give selected entrepreneurs access to industry reports, research papers, datasets, and other studies produced by government agencies for market research and expedited patent applications submitted by startups, as well as connections within the Startup India ecosystem. The innovative and entrepreneurial spirit that propels country’s development is embodied in India’s startup ecosystem. According to DPIIT director Sumeet Jarangal, this Memorandum of Understanding would strengthen India’s position as a global innovation leader by accelerating the conversion of ideas into meaningful solutions by leveraging the strengths of both parties.
Startup India’s Joint Secretary, Sanjiv Singh, underlined the importance of the Memorandum of Understanding in promoting an innovative and entrepreneurial culture, which are essential for India’s development. According to him, the collaboration would improve India’s standing as a worldwide leader in innovation by fostering an atmosphere that would enable companies to turn their concepts into useful solutions. He added that this partnership would give startups the boost they need to reach new heights and make significant contributions to the country’s technological and economic development.
DPIIT Forging Partnerships to Strengthen Startups’ Ecosystem
In recent months, DPIIT has formed four partnerships to support the Indian startup ecosystem. It joined together with HCLSoftware in October to advance its manufacturing incubator programme. Additionally, it established a business incubator in Gujarat in collaboration with Johnson Controls-Hitachi Air Conditioning India. Additionally, last week, the DPIIT teamed up with Moglix, a B2B e-commerce platform, to support manufacturing firms. The changes occur at a time when the startup scene in India is expanding rapidly. As of October 31, 2024, DPIIT-registered businesses have generated over 16.67 lakh direct jobs in over 55 industries, according to a statement made earlier this month by Commerce Minister Piyush Goyal.
A Memorandum of Understanding (MoU) has been inked by the Commerce Ministry’s Department for Promotion of Industry and Internal Trade (DPIIT) and B2B e-commerce platform Moglix to offer manufacturing firms 12-month incubation support. More than 25 growth-stage firms in the automotive, green energy, chemicals, and infrastructure industries will receive help from the program.
Via Credlix, its NBFC arm, startups will have access to Moglix’s mentor network, supply chain infrastructure, and financial support. DPIIT will expand the programme’s reach through its Startup India ecosystem, which will make it easier for startups to adopt, share resources, and reach a national audience.
The Collaboration Aims To Nurture and Guide Manufacturing Startups
Sanjiv Singh, Joint Secretary, DPIIT, discussed the partnership and stated that startups are driving India’s technological and economic advancement. This Memorandum of Understanding with Moglix demonstrates DPIIT’s dedication to promoting entrepreneurship, innovation, and the development of a robust manufacturing environment in line with India’s goal of independence.
According to a statement from Moglix, the programme will also give businesses access to resources, funding possibilities, and partnerships so they may develop globally competitive goods.
This partnership is a game-changer for India’s manufacturing industry. Rahul Garg, founder and CEO of Moglix, stated that the partnership seeks to create a sustainable, innovation-driven manufacturing economy that empowers entrepreneurs and supports India’s goal of becoming a global manufacturing hub by fusing Moglix’s technological know-how with DPIIT’s strategic direction.
Moglix Focuses on Solving Issues Related to Supply Chain and Manufacturing Sector
With a current valuation of $2.6 billion, Moglix supports 3,000 industries and more than 1,000 major manufacturers while providing over 7 lakh industrial commodities. Moglix’s commitment to improving supply chains and resolving issues faced by manufacturing companies in their growth stages is demonstrated by this partnership. It aligns with India’s national goals of becoming a global industrial leader and boosting the GDP contribution of the manufacturing sector.
The development occurs at a time when several businesses are setting up accelerators and incubators to support the nation’s startups. Two new firms were added to the first cohort of the KRAFTON India Gaming Incubator last month by the South Korean game company KRAFTON’s India division. Before that, Vivek Raina, a cofounder of internet service provider Excitel, started an incubator to support businesses in Jammu & Kashmir.
The vibrant Indian startup scene, which has generated over $154 billion in funding between 2014 and September 2024, is at the centre of it all. There are 112 soonicorns and 118 unicorns in the nation. Up to 31 Indian startups have listed on the bourses, with a thriving ecosystem that includes almost 10,000 investors.
The Reserve Bank of India (RBI) has announced the updated Foreign Exchange Management Regulations, 2024, to make it easier for startups to conduct business. The November 19 modifications open the door for the updated FX rules to incorporate the Department for Promotion of Industry and Internal Trade’s (DPIIT) 2019 decision on the amended definition of startups.
With regard to opening foreign currency bank accounts for DPIIT-recognised startups, the new regulations, known as the Foreign Exchange Management (Foreign Currency Accounts by a Person Resident in India) (Fourth Amendment) Regulations, 2024, are intended to streamline the procedure and eliminate any confusion among authorised dealer banks.
Reason For the Amendment
In the past, a company could only be classified as a startup if it had a turnover of less than INR 25 Cr and for a maximum of five years. DPIIT’s 2019 notification, however, raised the turnover cap to INR 100 Cr under the liberalised system and loosened the threshold to ten years from the date of formation. More DPIIT-recognized startups will be able to create and maintain interest-bearing accounts in Indian Rupees or foreign currency as a result of these changes, which will also be reflected in the updated forex regulations.
The DPIIT has more than 1.5 lakh registered startups. Startups that register with the agency are eligible for a number of benefits, such as tax deductions, reduced compliance requirements, and temporary immunity from labour law inspections. For ease of doing business, it is important to remember that earlier this year, the Budget 2024–25 recommended harmonising the concept of a “startup” across multiple laws.
Foreign Exchange Management Act
In order to facilitate foreign exchange payments and trade with other countries, the Indian government replaced the Foreign Exchange Regulation Act (FERA) of 1973 with the Foreign Exchange Management Act (FEMA) in 1999. For a variety of reasons, such as receiving and paying foreign currency, purchasing and transferring real estate outside of India, opening and maintaining foreign currency accounts, and investing in overseas businesses, FEMA compliance is required for Indian startups that deal in foreign exchange.
According to Mayank Arora, Regulatory Director at Nangia Andersen India, the recent change to the FEM (Foreign Currency Accounts by a Person Resident in India) Regulations is consistent with the DPIIT’s most recent notification, which aims to standardise the definition of a startup.
The RBI’s Foreign Exchange Management (Deposit) (Fourth Amendment) Regulations, 2024, added a new clause that permits authorised dealers in India to open and manage interest-bearing accounts in foreign currencies or Indian Rupees for non-resident individuals.
Nitin Konde
