This article has been contributed by Pritesh Mahajan, Founder, Revamp Moto.
The landscape of India’s business world is changing, and it’s changing rapidly. In recent years, sustainability has emerged as a central theme in global business discussions. The urgency to combat climate change and reduce greenhouse gas emissions has pushed companies worldwide to reevaluate their environmental impact. India is no exception. With a growing awareness of the environmental challenges and a commitment to cleaner, greener practices, Indian businesses are taking significant steps towards sustainability.
E-commerce and food delivery giants, in particular, are undergoing a significant transformation as they seek to align their operations with sustainability goals and cost-effectiveness. A key driver of this transformation is the shift toward electric fleets. This concept has become a huge motivating factor that encourages industry leaders to embrace electric vehicles and the profound impact it’s having on the business ecosystem.
Electric vehicles have become a symbol of this sustainability drive. These vehicles are not just environmentally friendly; they also offer substantial cost advantages over traditional internal combustion engine (ICE) vehicles. In India, EVs have garnered increasing attention for their potential to reduce air pollution, decrease fuel costs, and promote energy efficiency.
To put things into perspective, a study by Boston Consulting Group found that the total cost of ownership of a high-speed two-wheeler EV is around 35% lower than the same model with a combustion engine. An electric three-wheeler is 25% cheaper than its diesel counterpart. These numbers alone underscore the economic rationale behind the shift to electric fleets.
Several prominent e-commerce and food delivery giants in India are at the forefront of this electric revolution. Let’s delve into some real-life examples.
1. Zomato: Partnering for a Greener Tomorrow
Zomato, a multinational restaurant aggregator and food delivery company, has set ambitious sustainability goals. In 2022, Zomato partnered with Jio-bp, a joint venture of Reliance Industries and BP, with the aim of electrifying its entire fleet by 2030. At that time, the company already had around 4,000 riders using EVs for deliveries. Zomato’s strategy includes increasing awareness among its drivers on EVs across India and forming partnerships with original equipment manufacturers (OEMs) and leasing companies to accelerate the electrification of its fleet.
Amazon India, a major player in the e-commerce sector, joined forces with TVS Motor, one of India’s largest two-wheeler manufacturers, in 2022. This partnership aimed to bolster the deployment of electric two-wheelers and three-wheelers for last-mile deliveries. Amazon India has set an ambitious target of adding 10,000 EVs to its fleet by 2025, aligning with Amazon’s global commitment to adopt 100,000 EVs by 2030.
3. Flipkart: Pioneering Sustainability
Flipkart, India’s pioneering e-commerce company, has been a trailblazer in embracing EVs. It was the first Indian e-commerce company to introduce electric vehicles to its fleet and join The Climate Group’s EV100 initiative. Flipkart has made a bold commitment to become 100% electric by 2030, marking a significant milestone in its sustainability journey.
4. Swiggy and BigBasket: Delivering Green Convenience
Swiggy, India’s leading on-demand convenience delivery platform, embarked on a green journey by partnering with Taiwanese battery-swapping company Gogoro. This strategic move involved switching to electric intelligent scooters, contributing to reduced emissions and cleaner air. Similarly, BigBasket, an online supermarket based in Bangalore, is determined to electrify 90% of its fleet, demonstrating its commitment to sustainable last-mile deliveries.
5. Maersk: A Global Leader in Sustainability
Mærsk, a Danish shipping and logistics company, recognized the importance of electric vehicles in distribution logistics in India. In August, the company announced its plan to deploy an additional 500 EVs in 26 Indian cities to ramp up electrification in first-mile, middle-mile, and last-mile deliveries. Maersk had already taken the first step in September 2022 by launching electric three-wheelers and four-wheelers in Mumbai.
Technology Driving the Transition
Technology has played a crucial role in facilitating this transition to electric fleets. One notable example is UK-based Saietta’s Vehicle Control Unit (VCU) designed specifically for three-wheeled and four-wheeled light electric vehicles (LEVs). Saietta has partnered with HCLTech to manufacture the VCU in India and deliver over 80,000 units to Indian LEV manufacturers over five years. This partnership underscores the technological advancements that are driving the EV revolution in India.
Government Initiatives and Infrastructure Development
It’s worth noting that government initiatives have also paved the way for the adoption of electric fleets. The ‘Go Electric’ campaign, launched in 2021, seeks to educate the public about the advantages of EVs. Additionally, the FAME II scheme, aimed at supporting the electrification of public and shared transportation, has contributed to the growth of electric fleets in ride-hailing and delivery services.
One of the critical factors behind the success of electric fleets is the expansion of charging infrastructure. Both public and private players have invested in charging stations across the country. This development addresses a significant concern for potential EV buyers: range anxiety. With improved charging infrastructure, EV adoption is expected to accelerate further.
The Road Ahead
As more e-commerce and food delivery giants in India embrace electric fleets, the ripple effect of this transformation is evident. It not only aligns with global sustainability goals but also sets an example for other businesses to follow. The initial investment in EVs may be higher, but the long-term cost savings, reduced emissions, and positive impact on the environment make it a compelling choice.
As Pritesh Mahajan, Co-founder of Revamp Moto, a leading name in sustainable mobility solutions, puts it, “The adoption of electric fleets by e-commerce and food delivery giants is one of the most efficient ways to integrate electric vehicles on the road. It not only increases their visibility but also encourages more people to make the shift to cleaner and greener mobility options. This shift is a win-win, as it not only saves costs for businesses but also aids mobility among the hardworking delivery professionals. It’s a step towards a sustainable future that we can all be proud of.”
The shift to electric fleets by e-commerce and food delivery giants in India is more than a business decision; it’s a commitment to a cleaner, greener, and more sustainable future. With technology advancements, government support, and a growing charging infrastructure, the road ahead looks promising. As these industry leaders continue to lead by example, it’s only a matter of time before electric fleets become the norm in India’s delivery and logistics landscape.
As the sun rises on January 16, the nation proudly observes National Startup Day, a testament to India’s commitment to encouraging innovation and entrepreneurship. In 2022, Prime Minister Narendra Modi declared this day to celebrate the vibrant spirit of startups, acknowledging them as the backbone of a ‘New India.’ Since then, the startup landscape in the country has witnessed significant growth, with businesses sprouting across the nation.
In 2016, the Indian government laid the foundation for this growth with the inception of the Startup India initiative. Today, India stands as the third-largest startup ecosystem globally, with over 1,12,718 DPIIT-recognized startups spread across 763 districts as of October 3, 2023. The nation not only ranks second in innovation quality but also excels in scientific publications and the quality of its universities among middle-income economies.
In this context, StartupTalky connected with experienced individuals who have navigated the changing landscape of India’s startup ecosystem. In straightforward discussions, we explored their perspectives on India’s progress, the significant role played by the Government of India in driving growth, and their forward-looking views on the future of their respective industries. Their words reflect the pulse of a dynamic and ever-evolving entrepreneurial India.
Mr. Tarun Nazare, Co-Founder & CEO of Neokred Technologies, sharing fintech sector insights said, “Since 2016, we have witnessed the ecosystem go from boom to bust and bounce back. India’s startup landscape saw unicorns thrive, funding dip, and rebound. Now, the emphasis is on profitability with emerging sectors, promising resilient, innovative futures. Its advantages are that the Government is capitalistic, and focuses on the growth of all the sectors. Witnessed very active participation from RBI, regulator of Fintech. Expect mature decisions and good governance for yet-to-be-regulated sectors in the near future. We see promising activities from all the participants in all industries to make sure India’s GDP crosses more than $7 trillion by 2030.”
Kulin Shah, Co-founder and COO of Onsurity said, “Embarking on my entrepreneurship journey, witnessing the addition of over 68,000 startups, the space has undergone a transformative shift and evolved into leaders of product innovation. As the co-founder of an Insurtech, I’ve keenly observed the strategic initiatives that have propelled the rise of InsurTechs such as the regulatory framework, progressive policies, and initiatives. For example, with the introduction of the use and file process, insurers can introduce products to the market on filing with the regulator, thus avoiding a long waiting duration to get approvals. The introduction of regulatory sandboxes and streamlined licensing processes has further paved the way for growth.
Our industry has transcended from a selling approach to a seamless, digital realm, where transactions unfold effortlessly at the click of a button. Insurtech platforms are no longer just facilitators of claims but are comprehensive service providers, offering a diverse array of insurance options with a strong emphasis on convenience and paperless processes.”
HR Industry’s Evolution
Manish Panwar, Business Head, Vega HR,said, “India’s startup ecosystem has surged, driven by a young, dynamic, and talented workforce as well as increased funding, and government initiatives like Startup India. These measures include simplified regulations, tax benefits, and financial support, creating a conducive environment for innovation and entrepreneurship. The aim is to foster economic growth, and job creation, and position India as a global startup hub.”
“Cities like Bangalore, Delhi-NCR, Hyderabad, etc. are tech hubs, hosting diverse startups from fintech to ed-tech. Global attention and investment highlight India’s growing role in the global startup landscape.”
Panwar further added, “The future for the HR industry looks promising driven by a combination of government support, the startup boom, and the need for innovative talent management strategies. At Vega HR, we are passionate about creating solutions for employee rewards & recognition as well as enabling digital equity and streamline the process of ESOP management effortlessly. As companies recognize the importance of aligning employee interests with organizational success, total rewards (short-term & long-term) are expected to play a pivotal role in shaping the future of India’s corporate landscape, and we want to be at the forefront of steering this movement.”
Biotechnology’s Growth
Mr. Najeeb Bin Haneef, Founder and CEO of Zaara Biotech, shares his perspective on the success of his startup and the broader landscape of the biotechnology industry. Reflecting on the system around him, Mr. Haneef states, “The success of my startup does not depend on my knowledge or luck; it is solely because of the system around me that supports my dream.”
He emphasizes the role of various support initiatives, events, and schemes introduced by the government that have been instrumental in the growth of Zaara Biotech. “The various schemes of the state and central government help us reach our products and services in domestic and international markets as easily as a student startup. From our inception, we have explored all privileges available to a student startup, allowing us to pitch and exhibit at various national and international events, with significant support from the state legacy, Kerala Startup Mission.
“We presented our first product at GITEX Global in the Dubai World Trade Center under the Startup Mission scheme. There is always a boom in the startup ecosystem, and the government plays a vital role in creating synergies with international trade and exports. Research stations such as ICAR-CIFT Cochin also enable support for startups like us to reach a broader audience by placing products in various central government sectors. They also recommend participation in various training sessions funded by ICAR,of said Haneef.
Mr. Sumanth Prabhu, Co-founder & CEO of Ulipsu, shed light on the evolution of the EdTech industry in India. He said, “In 2014, the startup ecosystem was not this mature. There wasn’t much awareness about startups, funding, financial models, sales and marketing education, etc. Initially, it was a dream that merely existed but eventually, the startup ecosystem evolved. The startup knowledge, its concepts, the training and mentoring required can be found everywhere. The investing community has increased interest in startups today comparatively. Over the last decade, the government has made efforts to ensure that the startup ecosystem in India is thriving, and rightfully, it has matured today. With programs like the ‘Startup India Program’, different schemes have been available in different states all over India to foster the development of budding startups.”
“Existing startup policies and schemes that were available for companies irrespective of the EdTech industry, has helped us a lot. The Karnataka Government conducts an annual competition where deserving startups are given recognition along with financial grants as high as 50 lakh rupees. Ulipsu was also one of the participating companies in 2018 that was granted 20 lakh rupees. Likewise, a lot of such support initiatives and events were introduced by the government to expand growth,the said Prabhu.
Highlighting the growth prospects of the ed-tech industry, Prabhu said, “Working in the ed-tech sector, the opportunities have increased drastically because of NEP implementation. We are aware about the future of education. Through NEP, there have been collaborations between the industry and academics. Much more awareness & preference is being given to skilling rather than rote learning. Multiple credit-based and entry-exit systems are helping children explore what they want to pursue. Learning outcomes are being influenced and catalyzed by AI. India, having the largest youth population in the world, is where education will show growth more rapidly than ever.”
Tech and Electronics in India’s Startup Landscape
Sandeep Kumar, Founder and CEO, Baatu Tech, highlighting his startup journey said, “In my journey through India’s dynamic startup ecosystem, I’ve witnessed remarkable growth backed by substantial government support. India, now the world’s third-largest startup hub, has seen a surge in total funding from 2015-2022, with 108 Unicorns valued at multiple billions as of March 2023.”
“The government’s initiatives, such as startup challenges, National Startup Awards, Incubators and Accelerators, Networking opportunities, and state rankings, contribute significantly to this success. Startups with sustainable business models and those innovating around artificial intelligence, Software-as-a-Service (SaaS), and deep tech are anticipated to progress well. However, some challenges persist, particularly in funding, revenue generation, and supportive infrastructure,” said Kumar.
While discussing the way forward, Kumar emphasized, “The way forward necessitates pivotal roles for venture capitalists, angel investors, and the corporate sector. Policy measures, in alignment with the Digital India Initiative, are crucial. Bengaluru is a powerhouse in India’s startup ecosystem, hosting a remarkable 1,783 women-led startups, outpacing Mumbai (1,480) and Delhi (1,195), as reported by the startup data platform Tracxn. As India aims to become a global tech player, decisive policy measures and sustained support are vital for continued success, significantly beyond traditional sectors.”
Mr. Sanjeev Ingti, Director & Co-Founder of Eliea Wellness, sharing insights from the personal care industry, remarked, “During my journey, I’ve observed India’s remarkable strides in ecosystem studies. The nation has fostered a robust scientific community, embracing interdisciplinary research to understand and preserve its diverse ecosystems. Collaborations, technological advancements, and environmental policies showcase India’s commitment to sustainable development and biodiversity conservation.
The Indian government has actively propelled the medicinal personal care industry’s growth through policy initiatives, regulatory support, and incentives. Encouraging research and development, streamlining approvals, and fostering innovation have created a conducive environment for accelerated expansion, promoting health-centric products and contributing to the sector’s positive development.
The future of India’s personal care industry promises innovation driven by technology, sustainability, and wellness trends. With a surge in demand for clean and natural products, the industry is poised for eco-friendly advancements. E-commerce and personalized solutions will further redefine consumer experiences, shaping a dynamic and health-conscious landscape.”
Similarly, Mr. Lasakan Cholayil, Co-Founder of Sadhev, reflecting on the landscape of beauty and personal care startups, stated, “In my journey with Sadhev, I’ve seen firsthand the dynamic shift in India’s startup landscape. There’s a palpable energy, especially in our niche of organic beauty. It’s not just about business growth; it’s about a cultural shift towards sustainable living. We’re riding this wave, innovating and connecting with a community that values what we value.
The Government of India has been a catalyst for us. Initiatives like ‘Make in India’ haven’t just been slogans; they’ve opened doors. We’ve seen tangible support in promoting indigenous products, which has been a game-changer for brands like ours. It’s about preserving our heritage while scaling up.
Looking ahead, I see a horizon filled with opportunities. The trend is clear – there’s a growing demand for authentic, natural products. We’re not just selling products; we’re part of a larger movement towards sustainability. The market is ripe for innovation, and for startups like Sadhev, it’s a chance to lead this change, both in India and globally.”
Fashioning Entrepreneurship in India
Dhruv Toshniwala, Founder of The Pant Project, discussing India’s startup ecosystem, said, “At The Pant Project, we’ve had the privilege of witnessing India’s remarkable strides in the startup ecosystem throughout our journey. Over the years, we’ve observed a significant surge in entrepreneurial spirit, fostering a vibrant and dynamic landscape. The government’s proactive measures, such as ‘Startup India’ and various policy reforms, have created a conducive environment for startups. These initiatives aim to simplify regulations, reduce bureaucratic hurdles, and provide financial incentives, fostering a more supportive ecosystem. Many startups in India are not only focused on profitability but also on creating positive social impact. This dual approach has led to the emergence of socially conscious businesses that strive to make a meaningful difference in society.”
Highlighting the Government’s role in accelerating growth in the fashion industry, Toshniwala said, “The Government’s emphasis on skill development and education has contributed to a skilled workforce. This, in turn, has enhanced productivity and efficiency within the industry, aligning with the nation’s broader economic goals. Investments in infrastructure, including logistics and transportation, have streamlined our supply chain operations. Government initiatives to promote international trade have opened up new avenues for our industry. Bilateral and multilateral trade agreements have facilitated smoother exports and imports, contributing to the overall growth of the sector.”
“The digital landscape is transforming the way consumers shop. E-commerce, social media, and technology-driven experiences are shaping consumer behaviour. The Pant Project is strategically investing in digital platforms to enhance our online presence and provide a seamless shopping experience. The fashion industry in India is evolving towards greater inclusivity and diversity,” added Toshniwala.
In India’s startup journey, different businesses are growing with new ideas. From finance to fashion, they show how innovation and help from the government make a strong future. This is the story of a changing and hopeful world of startups in India.
This article has been contributed by Shubham Singhal, CEO and Co-Founder, Dot Media.
In the pulsating heart of the entrepreneurial ecosystem, startups stand as testaments to innovation, ambition, and the pursuit of dreams. As someone who has navigated this exhilarating journey, I, Shubham Singhal, Co-Founder & CEO of Dot Media, am compelled to shed light on the nuanced and diversified approaches that truly fuel startup financing. Furthermore, the role played by the Government of India and its initiatives cannot be understated in this narrative of empowerment.
Embarking on the entrepreneurial voyage with Dot Media in 2020, the challenges and triumphs of steering a startup through uncharted waters have been both exhilarating and enlightening. However, let’s set aside the specifics of my venture and delve into the broader canvas of startup financing, exploring how varied approaches intertwine with governmental support to foster an environment ripe for innovation.
In the symphony of startup financing, the resonant chords of venture capital and angel investors create a harmony that propels budding ideas into tangible realities. The financial infusion is, of course, invaluable, but it’s the mentorship, industry insights, and networking opportunities that truly transform startups.
Reflecting on the broader Indian landscape, initiatives like ‘Startup India’ have significantly contributed to the surge in venture capital and angel investments. This surge, similar to a gust of wind beneath the wings of startups, not only injects capital but also galvanises the entrepreneurial spirit. It’s a collaborative dance where visionary investors and startups sway together toward a shared vision of progress.
As I often muse, “Venture capital is not just about funding; it’s a partnership that nurtures the seeds of innovation into flourishing enterprises.”
Government Initiatives: Nurturing the Seeds of Innovation
Government-backed schemes and grants emerge as beacons of hope for startups seeking to navigate the financial network. Programs like ‘Stand Up India’ serve as catalysts for inclusive growth, providing not just financial support but also fostering a culture of innovation. The government’s commitment to this cause is noticeable, offering a helping hand to startups striving to make a mark.
In my experience, such schemes have played a pivotal role in not just infusing capital but also instigating a ripple effect of positive change within the organisational ethos. It’s more than financial assistance; it’s a tribute to the government’s belief in the power of startups to drive economic growth and societal progress.
In the realm of financial independence, bootstrapping stands tall as a witness to the resilience and self-reliance of startups. While external funding has its merits, there’s a unique sense of ownership that comes with building from the ground up. The Government of India’s emphasis on ‘Make in India’ aligns seamlessly with this ethos, encouraging startups to carve their paths.
The journey of self-funding is not just a financial strategy; it’s a mindset that fosters discipline and strategic decision-making. It’s about laying the foundation for sustainable growth without compromising on the core values that define a startup’s identity.
“In the world of startups, financing is not only about capital, it’s about strategic empowerment” notes Shubham Singhal.
Collaborative Initiatives and Incubators
In the tapestry of startup financing, collaborative initiatives and incubators are the threads that weave a supportive environment. Beyond the financial aid, these platforms offer mentorship, shared resources, and networking opportunities. The collaborative spirit nurtured within such ecosystems fosters an atmosphere where startups not only survive but thrive.
The establishment of numerous incubators and accelerators across India underscores the government’s commitment to creating an environment where startups can flourish. It’s a testament to the belief that by fostering collaborative ecosystems, we sow the seeds for a future where startups become not just economic entities but also drivers of societal change.
Synergy of Financing and Support
As I reflect on the twisted dance between different financing approaches and governmental support, it becomes evident that the synergy between these elements is the key to unlocking the true potential of startups. In the constantly changing world of entrepreneurship, success is not only defined by funding milestones but by the strategic leveraging of resources to foster innovation, sustainability, and meaningful contributions to the entrepreneurial tapestry.
Government’s Vision for Startups
The Government of India, through its visionary initiatives, has played a pivotal role in shaping an environment where startups can thrive. It’s not just about creating financial incentives; it’s about fostering a culture that believes in the power of startups to drive economic growth, create jobs, and usher in a new era of societal progress.
As we continue to navigate the uncharted waters of entrepreneurship, let us recognize that the empowerment of startups is not a solitary endeavour. It’s a collaborative journey where the echo of diverse financial approaches harmonises with the supportive chords played by the Government of India, creating a symphony that resonates with the promise of a vibrant and dynamic entrepreneurial future.
As an entrepreneur who has confronted challenges head-on and cherished victories, I can affirm the pivotal role that collaborative initiatives and visionary government schemes play in the entrepreneurial world.
This article has been contributed by Greeshma Unnikrishnan, Co-founder and Chief Operating Officer, Medprime Technologies.
Technology is driving the world in a direction thatwas unimaginable centuries ago. Today we live in an interconnected world, driving innovation, automation, and transformation. The field of healthcare is no exception with the health tech industry forging ahead and making progress by leaps and bounds. Owing to the flourishing landscape, demand for innovative health services, and government policies, the Indian health tech industry is predicted to grow to $5.5 billion by 2025. Increased funding and investments, government initiatives, and technological advancements have further bolstered the health tech startup ecosystem. It is interesting to see the current trends that are making headway into the future of the Healthtech startup ecosystem, especially the medical device industry.
Integration of Artificial Intelligence: Digital Microscopy and Beyond
With scientific innovations and technological advancements, digital microscopy like all other aspects of medical technology, has showcased continuous improvement in quality, accuracy, and efficiency for life science research, pathology, and more recently, telepathology and telemedicine. It supports researchers and doctors in the interpretation of images, immediate insights, and much more. The integration of AI and machine learning will further automate, reduce time and effort in manual practices, and increase accuracy. The cutting-edge technologies are revolutionary, providing intelligent interpretations, sophisticated analyses, precision, and reliable outcomes.
Remote Diagnosis: Breaking Boundaries of Geographies, Distance, and Time
The COVID-era took the world by storm but also brought to the forefront the loopholes in the healthcare industry. With borders shut and accessibility in question, remote diagnosis was the silver lining in the chaos. Remote diagnosis is here to bridge the gap of accessibility in healthcare and its adoption must no longer be a matter of choice but compulsion. The field of pathology has seen a transformative change in the form of remote diagnosis, with digital image sharing and timely analysis of images of pathological evidence that goes beyond distance, locations, and time enhancing research, consultation, and diagnosis. Rural India will see exponential growth in healthcare with remote diagnosis and telemedicine.
Telemedicine or Telehealth: Mainstream in New-Age Healthcare
Telemedicine is no longer an aspect of healthcare but must be recognised as mainstream in medicine as its full potential can bridge the major gaps in the system. It allows healthcare professionals to evaluate, diagnose, and treat patients in remote locations using telecommunications technology. Quality healthcare, universal health coverage, and accessibility are all by-products of traditional healthcare. Telehealth offers the advantages of synchronised data, time, and location independence, making treatment for patients more affordable and available.
Government Support and Initiatives for Healthcare Startups
Startup India, Digital India, Ayushman Bharat Digital Mission, National Digital Health Mission, and Make in India to name a few are the pillars of the healthcare startup ecosystem. The government policies and initiatives for startups are laying a conducive environment to thrive and flourish, thus making room for investments, innovations, and advancements in the field of digital healthcare.
The government initiatives are supporting and assisting in regulatory approvals, enhancing the ease of doing business, ease of raising capital and reducing the compliance burden for the startup ecosystem. The increased number of programs, workshops, and seminars in relation to the regulations eases startups into the process and overcome challenges that could be a hindrance while doing business. There is a solid regulatory framework for startups to avoid lapses and legal issues.
The (SIPP) Scheme for Facilitating Startups Intellectual Property Protection aids startups in terms of costs to be borne to file a patent, approvals of patents and trademarks, and access to patent and trademark attorneys. There are no professional fees and startups have to pay only the statutory fees making it easy for them to focus on other aspects of the business and save heavy costs which would otherwise add to the financial burden. This also helps startups protect their intellectual property, protecting them from larger companies that may look to copy the innovation by startups.
Earnest Money Deposit (EMD) is the bid security amount that startups are exempted from paying and can go ahead and participate in tenders and bids. EMD which is mandatory in the procurement process is eased for startups thus avoiding the burden on their financial capabilities. This provides increased opportunities for startups in terms of participation in bids and tenders as the financial cost is handled by the government.
Government e Marketplace (GeM), set up by the Government to make public procurement process transparent, efficient, and inclusive. It is a centralised and unified fully automated portal where common user goods and services can be procured, a dynamic, self-sustaining, and user-friendly portal for making procurement by Government officers. A category called Startup Runway makes the procurement of innovative patented products much easier by bypassing the need for buyers to get multiple quotations.
The tax holiday for startups came as a respite where startups can avail 100% tax exemptions on profits earned for a block of three years in the first ten years of incorporation.
The digital Healthtech startup industry is making healthcare accessible, affordable, and available. With the help of government policies and initiatives, the Indian healthcare startup ecosystem is forging ahead toward progress, growth, and innovation.
Ancient practices such as tithing or the offering of first fruits may be regarded as the precursor of the income tax. However, they lacked precision and were not based on the concept of a net increase. As civilization progressed, taxes were based on other factors like wealth, social position and ownership of the means of production.
The modern concept of income tax is based on a pre-supposition of a money-economy, accurate accounting and a general understanding of receipts, expenses and profits and an orderly society with reliable records. Hence, income tax can be defined as a tax imposed on individuals, commonly known as tax-payers, in respect of the income or profits earned by them.
In India, most taxpayers know about and take advantage of the INR 1.5 lakh deduction that is available under Section 80C. However, there are many other tax-saving opportunities that can help if further reducing taxes paid.
National Pension Scheme (NPS) Under Section 80CCD (1B)
Over and above the benefit that can be claimed by Section 80C, additional tax can be saved by investing up to INR 50,000 in NPS. This investment can increase the total deduction to be claimed to INR 2 lakh
Share of Instruments in Gross Household Saving
Interest Component of Home Loan Under Section 24
The interest component of a home loan can be claimed as a tax deduction under Section 24 of the Income Tax Act. A maximum amount of INR 2 lakh can be claimed on the interest payment on a home loan for a self-occupied property. If the residential property is not self-occupied and rented or deemed to be rented, the entire interest amount can be claimed as a tax deduction as there is no maximum limit has been prescribed. If the residential property is not self-occupied due to reasons of employment, business or profession, a maximum tax deduction amount of INR 2 lakh can be claimed under section 24.
Interest Repayment for First-Time Home Owners Under Section 80EE
This is applicable for first-time homeowners who do not have any other residential property on the date their home loan is sanctioned from a financial institution. Such homeowners can claim a tax deduction of up to INR 50000 under Section 80EE. This tax deductible amount is over and above the INR 2 lakh available under Section 24. Rules applying to claim this amount as a tax deduction specify that the total value of the residential property must be less than INR 50 lakh and the loan value should not exceed INR 35 lakh. This section was initially introduced in 2013-14 and was available for only two years before being re-introduced in 2016-17. This particular tax benefit is applicable till the loan amount is repaid with the annual limit capped at INR 50000.
Premiums Paid on Health Insurance Under Section 80D
The tax incentive for Section 80D allows for tax deductions the total amount that is paid as the premium amount for health insurance as well as the expenses that are incurred towards healthcare. Depending on the people and their age, who are included under the insurance coverage the limit to claim tax deductions can range from INR 25000, INR 50000, INR 75000 or INR 1 lakh.
Interest Earned From Savings Bank Account Under Section 80TTA
Section 80TTA allows all individual taxpayers and HUF to claim tax deductions on the interest earned from savings bank accounts in banks or banking companies, savings accounts in post offices or savings accounts in cooperative societies involved in the banking business. The maximum amount that can be claimed from all savings accounts is INR 10000. Interest earned above this limit is considered as ‘Income from Other Sources’ and is taxable. For senior citizens who are taxpayers, Section 80TTB is applicable which was introduced on April 1, 2018, and carries a lower tax implication on the interest income. Under Section 80TTB, up to INR 50000 can be claimed as a deduction.
Medical Expenses for Disabled Dependent Under Section 80DD
This tax deduction has been offered to help taxpayers take care of dependent disabled family members. These dependents are defined as spouses, children, parents or siblings. Disabilities covered under this policy include blindness, low vision, locomotor disability, hearing impairment, mental retardation, mental illness, autism and cerebral palsy. The following medical expenses can be claimed as tax deductions –
Expenses incurred towards medical treatment, nursing, training, rehabilitation of a dependent with a disability
Amount paid as premium for an insurance policy designed for such cases and satisfying the conditions mentioned in the law
The amount that can be claimed varies on the degree of the disability of the dependent. Up to INR 75000 can be claimed as a tax deduction annually if the dependent suffers at least 40% of any specified disability. A severe disability of 80% or more in a dependent allows the taxpayer to claim up to INR 1.25 lakh. A medical certificate from qualified institutions must be submitted by taxpayers to claim such tax deductions.
Treatment of Specified Diseases Under Section 80DDB
A taxpayer suffering from diseases like cancer, neurological diseases like dementia, motor neuron diseases, Parkinson’s or AIDS entailing expensive treatment costs can avail of tax deductions under Section 80DDB. The amount that can be claimed as a deduction is INR 40000 or the actual amount, whichever is lower. For senior citizens who are taxpayers or dependents, this limit is increased to INR 1 lakh.
Amount Paid as Rent With No HRA Payment Under Section 80GG
An individual taxpayer who does not receive HRA as a salary component or is self-employed can claim tax deductions towards rent up to INR 60000 annually under Section 80GG. The conditions for availing such tax deductions do not include taxpayers who own a house but live in rented accommodations within the same city or living in rented accommodations in another city and claiming deductions under Section 24 for repayment of home loan interest.
Repayment of Education Loan Under Section 80E
Students availing of education loans to pursue higher education are eligible to claim tax benefits on the repayment of the interest component under Section 80E. This deduction is available on taking an education loan from financial institutions and not from relatives or other family members. The tax deductions can be claimed from the year the repayment of the loan begins for seven consecutive years or until the interest is paid in full, whichever is earlier. There is no limit to the deduction claimed on the interest amount repayment.
Donations Made to Charitable Institutions Under Section 80CCC
Donations made to approved charitable institutions are eligible for tax deduction claims with appropriate supporting documents like a stamped receipt from the trust or institution, complete address, name of the trust and the PAN card number of the trust or institution. A tax deduction of 50% or 100% can be claimed depending on the charitable institution to which the donation is made. However, the total donation amount should not exceed a maximum of 10% of the adjusted gross total income of the taxpayer. The four ways in which donations can be categorized to claim the deduction are –
Donations to the National Defence Fund set up by the central government can be claimed as a 100% deduction without any qualifying limit
Donations to Jawaharlal Nehru Memorial Fund or the Prime Minister’s Drought Relief Fund can be claimed as a 50% deduction without any qualifying limit
Donations with 100% deduction subject to 10% of adjusted gross total income such as Government or any approved local authority, institution or association to be utilized for the purpose of promoting family planning
Donations with a 50% deduction subject to 10% of adjusted gross total income such as any institution which satisfies conditions mentioned in Section 80G(5)
Conclusion
These tax saving instruments can be a huge help for taxpayers to save on income tax and reduce income liability. This income, can then, be utilized towards investment and growing savings.
FAQ
Which is the best tax-saving instrument in India?
The following are the best Tax-Saving Instruments you can use
Equity Linked Savings Scheme (ELSS)
Public Provident Funds (PPF)
Senior Citizen Savings Scheme (SCSS)
Sukanya Samriddhi Yojna (SSY)
Tax Saver Fixed Deposit (FD)
National Pension Scheme (NPS)
National Savings Certificates (NSC)
Unit Linked Insurance Plans (ULIP)
How to save tax for 12 LPA?
Tax Deductions under Section 80(C) can help you to reduce your taxes. You can invest in PPF, EPF, ELSS, NSC and others to save taxes.
How can I save tax smartly?
Under Section 80C you can save your tax and these are the scheme which comes in 80C
Equity-Linked Savings Scheme: Equity Linked Savings Schemes are a type of mutual fund with a lock-in period of three year
Senior Citizen Savings Scheme
National Pension System
Term Life insurance premium
Public Provident Fund
National Savings Certificates
Tax-saving FDs
Home loan repayment
How much income is tax-free?
If your income is below ₹2.5 lakhs, you do not have to file Income Tax Returns (ITR).
The entrepreneurial dreams of Indians have given the country over 94 Unicorns in recent years. This number is expected to cross a century by the end of 2022. Startups across the MSME sector have been at the heart of the Indian economy and generated millions of jobs for people across the country.
It is anticipated that MSMEs alone contribute 8% of the overall GDP, and startups play a huge role in it. But unfortunately, not every entrepreneurial dream gets the chance to take off due to a lack of funds. Keeping this in mind, the Indian government offers various government loans to help passionate entrepreneurs make through.
Budding entrepreneur with a revolutionary idea in mind should use the government loan schemes to transform their ideas into action. For further assistance of all entrepreneurs, we’ve curated this epic guide that has all the information on how to avail of a government loan for a startup.
Government business loans have always provided the necessary financial backing to startups. If a startup requires some financial help, the founders might want to apply for any one of the following government loans for a startup.
Pradhan Mantri MUDRA Yojana (PMMY)
Pradhan Mantri MUDRA Yojana (PMMY) – Government Business Loans for Startups
Launched in 2015, this government loan scheme offers business loans to non-corporate & non-farm small and micro-enterprises. Under this scheme, startups can avail of a loan amount of up to Rs. 10,00,000. The tenure for repayment for this collateral-free loan ranges from one year to five years. Startups can avail of this loan by visiting any nearest small finance bank, microfinance institution, commercial bank, and non-banking financial company.
The Pradhan Mantri MUDRA Yojana provides loans depending on the development stage of the startup. Hence, the applicants can find the following three segregation under this loan:
Loan Type
Coverage
Yearly Rate of Interest
Shishu
Up to Rs. 50,000
1% to 12%
Kishore
Above Rs. 50,000 to up to Rs. 5,00,000
8.60% to 11.15%
Tarun
Above Rs. 5,00,000 to up to Rs. 10,00,000
11.15% to 20%
Startup founders can apply for this loan if they’re a trader, shopkeeper, vendor, etc. Just visit any lending institution mentioned above or login to a PSB or 59 minutes portal and do the needful. They will guide further. Startups can utilize this loan as a working capital loan through the offered MUDRA card.
Pradhan Mantri MUDRA Yojana (PMMY) – Government Business Loans for Startups
MSME Loan in 59 Minutes
MSME Loan for Startups Approved in 59 minutes
As the name suggests, this loan offered by the government is approved in 59 minutes flat. Launched by SIDBI, this loan is ideal for small and medium-size startups that need capital assistance of under Rs. 10, 00,00,000 at a somewhat lesser interest rate. In some cases, the interest rate is as low as 8%.
To avail of this Public Sector Banks (PSB) loan scheme, startup founders can visit the Central Bank of India, Canara Bank, Bank of Baroda, Bank of India, SBI, etc., for a hassle-free loan application process. Once the loan application is processed and approved, the applicants can get the amount within 8-10 working days. Startup founders can also visit the PSB loan in 59 minutes portal to get more details about this loan scheme and apply.
Credit Guarantee Fund Trust Scheme for Micro & Small Enterprises
CGTMSE for starting new Business
Also known as CGTMSE, this government business loan provides collateral-free loans to startups. Launched by the SIDBI and MSME ministry, this loan scheme offers a loan amount of up to Rs. 2,00,00,000 to both new and existing startups. A special preference is given to women entrepreneurs under this loan scheme. Under the CGTMSE, startups can get a collateral-free loan of up to Rs. 10,00,000. But for any amount above this value, startups will have to provide collateral in the form of any building or land attached to the primary business.
Those who want to avail of the CGTMSE loan can approach a scheduled commercial bank or select a regional rural bank classified by NABARD for loan approval. Both new and existing startups can apply for this loan engaged in manufacturing activity, retail trade, and service activity.
Credit Facilitation Through Bank by NSIC
NSIC Launched by the MSME ministry for business loans
The NSIC has signed an MoU with various banks to provide super-fast and hassle-free loans to different startups. Launched by the MSME ministry, this one-of-a-kind loan facility is provided by NSIC under the central government. The best part of this government loan is that NSIC also helps complete the full documentation and legal formalities to quickly avail of the loan.
Small or medium startups needing a short-term loan for maintaining working capital or other operations should consider applying for this loan. It is a reasonably low-interest loan and can be availed by visiting any well-known banking institution like the HDFC bank, ICICI bank, Axis bank, YES bank, etc.
Credit Link Capital Subsidy Scheme
Also known as CCLCSS, it is a loan provided by the MSME ministry and the government of India to startups for technology upgradation. Startup founders that own a manufacturing enterprise, textile startup, fabrication unit, or any business that uses machines and equipment should avail of this loan of up to Rs. 15 lakh to upgrade to the latest technology. This loan helps startups stay up-to-date regarding technology to withstand the competition at local and global levels.
How to Choose the Best Loan Ideal for Your Business?
Now that the information related to top business loans offered by the government to startups is made available, some entrepreneurs might be confused about which one to proceed with. The answer is pretty simple. Every loan discussed above has a different purpose, interest rate, credit limit, etc. The startup founders should go ahead with the one that helps the business stay afloat and even scale in the best way possible.
To apply for any of the above-discussed government business loans, startup founders can head to the respective website of the financial institution providing the loan, fill out the application, and wait for someone from the organization to contact them. Business loans offered by Government are sure to help you accelerate your business growth, so they should be applied for.
FAQs
What are the Government loans for startups?
List of Government Loans for Startups are:
Pradhan Mantri MUDRA Yojana (PMMY)
MSME Loan in 59 Minutes
Credit Guarantee Fund Scheme for Micro & Small Enterprises
Credit Facilitation through Bank by NSIC
Credit Link Capital Subsidy Scheme
How much loan can you get under the MSME government business loan scheme?
Under the MSME government business loan scheme, as an MSME, a startup/business can get a loan sanction of up to Rs. 1 crore within just 59 minutes.
What is the eligibility for a startup business loan?
Eligibility Criteria for Startup Business Loan are:
Resident citizen of India
Minimum CIBIL score of 700
Business should at least 2 years old
Annual income of business should be at least INR 2 lakhs
Applicant Should be between 21 years to 65 years of age
The Government of India owns the Life Insurance Corporations of India (LIC), which is an insurance and investment business. The Life Insurance Corporation of India (LIC) was established on September 1, 1956, when the Parliament passed the Life Insurance of India Act, which nationalised the Indian insurance business. The state-owned LIC was formed by the merger of over 245 insurance companies and provident organisations. It both encourages and results in the institutionalisation or mobilisation of savings.
Since then in the field of life insurance, the LIC has near-monopoly, as the amount of life insurance business through postal insurance and state insurance is relatively much smaller. Life insurance is a very important form of long term contractual savings. The total volume of the insurance business has been growing in the country with the spread of knowledge and consciousness about insurance in the country.
However LIC can grow at a faster rate if the organizational and operational efficiency of LIC can be improved, new kinds of insurance covers are introduced, its services are extended to smaller lesser-known places and the general price level is kept stable. As of 2019, the Life Insurance Corporation of India had a total life fund of ₹28.3 trillion. The total value of sold policies in the year 2018-19 is ₹21.4 million. Life Insurance Corporation of India settled 26 million claims in 2018–19. It has 290 million policyholders.
LIC invests in various sectors such as cement, banks, chemicals and fertilizers, transmission and electricity, engineering, construction and infrastructure, electrical and electronics, healthcare, hotels, finance and investments, information technology, metals and mining, motor vehicles, oil and natural resources, retail, textiles, transportation and logistics.
Among those companies, LIC’s holding I term of value in 2012 was established to be the highest in ITC (₹27,326 crores), followed by RIL (₹21,659 crores), ONGC (₹17,764 crores), SBI (₹17,058 crores), L&T (₹16,800 crores), and ICICI Bank (₹10,006 crores). The share price drop in ITC on 18 July 2017 had caused LIC a major loss of around 7000 crores during the financial year.
Where LIC also holds a 51% stake in IDBI Bank, making it the only insurer in India to own a bank, since regulations prohibit insurers from holding more than 15% stake in any company.
LIC subsidiaries
LIC Pension Fund Limited
LIC Pension Fund Limited is India’s first pension fund. It was set up by Life Insurance Corporation (LIC) in November 2007. LIC is one of India three public sector pension fund managers and has a one-third share in all investments made through Central and State Government NPS. It is also open to the private sector as a fund manager. LIC Pension Fund is the first Pension Fund Company in India to be incorporated and to receive commencement of business certificate.
The government of India introduced the New Pension System (NPS), with effect from 2004. Pension Fund Regulatory And Development Authority (PFRDA) through a process of competitive bidding, has appointed Life Insurance Corporation (LIC), State bank of India (SBI), UTI Asset management company (UTI –AMC) and as The Pension Fund under the NPS. “NPS-Lite Model” is designed to ensure ultra-low administrative and transactional costs, so as to make such small investments viable.
National Pension System NPS Lite makes pensions possible for small investors. It is an initiative of the Pension Fund Regulatory and Development Authority (PFRDA), the apex body established by the Government of India to regulate and develop the pension sector in India. NPS extends help to the weaker and economically disadvantaged sections of the society with their limited investment potential. This is why PFRDA has launched NPS Lite to specifically target the marginal investors and promote small savings during their productive life. It also aims at building up a corpus sufficient enough to buy an annuity for their old age.
LIC Cards services limited came into existence in 2008 as a 100% subsidiary of LIC to bring out its own credit cards in the market. LIC offers four types of credit cards and each of these cards come with some common features and some distinct features that make them unique. LIC credit cards are best suited for you if you regularly pay a large LIC premium. LIC cards are uncapped, while other cards have a cap cashback and reward points that can be earned on premium payments.
The types of LIC Cards
The types of LIC cards are:
LIC Gold Credit Cards (for regular users)
LIC Platinum Credit Cards (for shopping and rewards)
LIC Titanium Credit Cards ( for travel and hotel booking)
LIC Signature Credit Card (for premium services)
Fee/Charge
Amount/rate
Finance Charges on Revolving Credit and Cash Advance
3.25% p.m. (46.78% annual)
Free Credit Period
Free Credit Period Up to 50 days
Cash Withdrawal Fee
2.5% of the amount withdrawn (min. Rs. 500)
Cash Payment Fee
Rs. 100
Over Limit Fee
3% of the amount (min. Rs. 500)
Foreign Currency Mark-up Fee
3.5% of the transaction amount
There are certain criteria that the financial institution looks into before accepting your credit card application. Your credit score, age, monthly income, location etc. are some of the parameters that you should keep in mind before you apply for a credit card. To apply for a LIC credit card, you should be above 18 years and should either be a LIC agent or a LIC policyholder. The document required to apply for a LIC credit card are:
Proof of Identity – PAN Card, Aadhaar card, Driver’s License, Passport, Voter’s ID, Overseas Citizen of India Card, Person of Indian Origin Card, Job card issued by NREGA, Letters issued by the UIDAI.
Proof of Address – Aadhaar card, Driver’s License, Passport, Utility Bill not more than 3 month’s old, Ration Card, Property Registration Document, Person of Indian Origin Card, Bank Account Statement.
Proof of Income – Latest one or 2 salary slips (not more than 3 months old), Latest Form 16, Last 3 months’ bank statement.
IDBI Bank Ltd., as a full-service universal bank provides a wide gamut of financial products and services encompassing deposits, loans payment services and investment solutions. Understanding today’s fast-paced and digital world they offer an innovative range of digital services that complement the pan India network of branches and ATMs. The bank also has 24×7 customer care facilities to help its customers reach out. IDBI Bank Ltd is operating as a full-service universal bank that serves customers from all segments.
As a universal bank, IDBI Bank Ltd. touches the lives of millions of Indians through a wide variety of banking products and services. The Bank also has an established presence in associated financial sector businesses including capital market, investment banking and mutual fund business. IDBI’s very business philosophy is to provide relevant financial solutions, ensure maximum customer convenience through easy access to branches and ATMs as well as digital offerings and excellence in customer service.
IDBI Subsidiaries
The vision is to be the most preferred and trusted bank enhancing value for all stakeholders defining and shaping our day-to-day business, helping us to build long-lasting relationships. IDBI Bank Limited has been categorized as a ‘Private Sector Bank’ for regulatory purposes by the Reserve Bank Of India with effect from January 21, 2019, consequent upon Life Insurance Corporation Of India acquiring 51% of the total paid-up equity share capital of the bank. To cater to its ever-expanding needs, IDBI Bank has formed subsidiaries and joint ventures across diverse areas of the Banking and Financial System.
Some of its subsidiaries are:
IDBI Capital Markets and Securities Limited (ICMS)
Its businesses include Merchant Banking, Stock Broking, Distribution of Financial Products, Corporate Advisory Services, Debt Arranging and undertaking, Portfolio management of pension and Research Services.
IDBI Intech Limited (IIL)
The major business activities of the company are Information technology services, information security practices, national contact centre and outbound sales team.
IDBI Asset Management Limited (IAML)
IAML is the investment manager of schemes launched by IDBI Mutual Fund. The Fund offers a bouquet of products inequity and risk profiles of investors.
IDBI Trusteeship Services Ltd (ITSL)
The company operations are acting as trustees to securitization transactions, acting as Bond/Debenture trustee, Security trusteeship assignments, Share pledge Trustee, Venture Capital Fund, Safe Keeping and other trusteeship services.
IDBI Federal Life Insurance Company Limited (IDBI Federal)
The Company’s life insurance business comprises individual life and pension and group life, including non-participating, health and linked segments.
FAQ
In which sectors LIC invest?
LIC invests in various different sectors such as cement, banks, chemicals and fertilizers, transmission and electricity, engineering, construction and infrastructure, electrical and electronics, healthcare, hotels, finance and investments, information technology, metals and mining, motor vehicles, oil and natural resources, retail, textiles, transportation and logistics.
What is LIC Pension fund limited?
LIC Pension Fund Limited is India’s first pension fund. It was set up by Life Insurance Corporation (LIC) in November 2007. LIC is one of India three public sector pension fund managers and has a one-third share in all investments made through Central and State Government NPS. It is also open to the private sector as a fund manager. LIC Pension Fund is the first Pension Fund Company in India to be incorporated and to receive commencement of business certificate.
How many types of Cards does LIC provide?
LIC Gold Credit Cards (for regular users) LIC Platinum Credit Cards (for shopping and rewards) LIC Titanium Credit Cards ( for travel and hotel booking) LIC Signature Credit Card (for premium services)
The PPP (Public Private Partnership) Projects in India have provided mixed results. The country had faced problems in regards to land acquisitions, overextended balance sheet, contract disputed and lack of a mechanism for the resolution of disputes.
Certain projects have left the large public sector banks to end up with bad loans. However, the Finance Minister has announced a new policy to fasten the PPP projects. In this article let’s look at the new project announced by the government.
The Finance Minister of the country, Nirmala Sitharaman on 28 June 2021 had conveyed a new simpler and more efficient and effective approval process for the PPP projects as well as financing of the core infrastructure projects that will be formulated in the country.
This new formulation will help the CPSEs (Central public sector enterprises) to fasten up the asset monetization. The Finance Minister announcing various economic relief measures had conveyed that the current measure requires a lot of approvals for Public Private Partnership projects and was really long.
What are PPP Projects?
PPP projects are the process where the public services are delivered by the private entities which are awarded through a competitive bidding process. These projects are typically run on the lines where the private entity would build it, operate it for some time and later transfer it.
This method of undertaking the projects is favored by various Governments on a global basis as it makes up for the shortfall of the investments the Government of a particular country can undertake.
Experts convey that the PPP strategy holds promise for the creation of infrastructure if the financing sector is tied up.
The new policy for the approval and the appraisal of the public private partnership proposalsand financing of the core infrastructure projects, including the one through InvITs (Infrastructure Investment Trusts) is aimed at providing and assurance for a faster way towards clearance of projects and to provide support and facilitate the efficiencies of private sector in regards to monetize construction and the management of the infrastructure.
Nirmala Sitharaman added that, this new policy will help in moving ahead with the proposal of budget regarding the financing of assets.
T V Somanathan, who is the expenditure secretary has conveyed that the further details of the project will be announced by the Department of Economic Affairs. In the Budget Speech of 2021-22, Nirmala Sitharaman had announced that operating the public infrastructure assets is a very important financing operation for the new construction.
She had stated that there would be a launch of a national monetization pipeline of a potential brownfield infrastructure asset.
Some of the core infrastructure assets that will be covered under the asset financing programme are the toll roads that are operated by NHAI, transmission assets of the PGCIL, the oil and gas pipeline of GAIL, HPCL and IOCL, AAI airports in the tier II and tier III cities.
The other core infrastructure assets included under this programme are railway infrastructure assets, sports stadiums, warehousing assets of the Central Public Sector Enterprises such as the Central Warehousing Corporation and NAFED.
Conclusion
The new PPP project policy that is stated by the Finance Minister seems to have scope for undertaking a fast track on completing the infrastructure projects and to facilitate the efficiency of private sectors in regards to monetization on the projects.
FAQ
How do PPP projects work?
Public-private partnerships allow large-scale government projects, such as roads, bridges, or hospitals, to be completed with private funding.
What does PPP mean?
Public-private partnership (PPP), partnership between an agency of the government and the private sector in the delivery of goods or services to the public.
How many active PPP projects are there in India?
There are around 1,069 active PPP Projects in India.
The new year brings fresh and innovative business prospects to your creative minds. Granting startups will make those innovations feasible.
Yet it’s not always straightforward to address the issue of how to get funding for a startup. You must know where you are going to look and get ready to do the job you need to make your dream come true.
It is time you took a near dive into your investment opportunities if you really want to get a startup off the ground and see it become a profitable venture.
The first stage anytime you need money to start up a company is to report the initial costs. Take out all needless or unsustainable costs in order to detect the critical criteria of the startup.
In order to collect funds to launch your own company or extend your existing business, you can secure a start-up business loan from any bank or financial institution. The interest rate paid to the bank depends on the amount of the loan you earn and the tenure of repayment.
The loans are currently provided for a value of ₹1 Lakh to ₹1 cr with a rate of interest of more than 8%. MSME Business loan in 59 minutes initiative aims at loan appraisal process automation ultimately resulting in getting eligibility letter, in-principal approval in less than an hour. post the in-principle approval, the loan is expected to be sanction/disbursed in 7-8 working days.
To be eligible for this loan as a borrower you should be GST, IT compliant and must have six months bank statement facility. The business loan eligibility is determined by a company’s, income/ revenue, repayment capacity, existing credit facilities, any other factors as set by lenders (banks)
The Credit Guarantee Scheme (CGS)
To be able to avail Credit Guarantee a startup has to be recognized by DIPP (Department of Industrial Policy and Promotion). The Credit Guarantee consists of at least startup loans for a financial year and will be offered on the basis of a portfolio.
Coverage offered by the scheme –
This scheme covers up to 80% of the credit facility for MSMEs owned by women and all loans granted to North-East-Region including Sikkim.
The scheme will be providing credit to cover up to 75% of the credit facility subject to a ceiling of Rs. 150 lakh. For micro-enterprises, the scheme covers up to 85% credit facility.
50% of the amount of credit for MSME retail trade will be covered under this scheme.
Stand Up India Scheme
This scheme aims to set up an enterprise in manufacturing, services, or agriculture allied activities by SC/ST/women entrepreneurs. To be eligible your project must be a greenfield project. This scheme facilitates bank loans between 10 lakh to 1 crore. The interest rate for the loan is the lowest applicable rate of that bank for that specific category.
Coir Udyami Yojana
The main objective of the scheme is to facilitate the development of the coir industry in India. The scheme is running under the ambit Ministry of MSME. Coir Udyami Yojana is a mix of loans and subsidies. The rate of subsidy and bank credit rate is 40% and 55% respectively. Your project won’t be eligible for the scheme If your project has already availed subsidiary under another scheme of the central government.
The loan covers capital expenditure, building, and machinery. Working capital is not considered in this scheme. Also if the work shed is already available it is not covered in the loan. Loan under Coir Udyami Yojana is covered through the CGTMSE scheme under the Ministry of MSME.
National Bank for Agriculture and Rural Development (NABARD)
Through this scheme government of India is encouraging farmers in taking up projects aimed at enhancing capital investment, sustained income flow, and employment areas of national importance.
The borrowers shall execute the paperwork required and send documentation for the use of these credits. As the government funds the projects, some of the loans are free of collateral. In the following you will notice some points to review before applying for the loan:
Personal record: background information is reviewed. Crimes performed or criminal history will disqualify or postpone the loan sanction phase.
Based on resume or company background: information of the company and applicant’s skills in developing the business will be asked.
Business proposal: the borrower has to bring into the loan document a well-considered business plan.
The interest rate and maturity tenure differ between banks. The interest rate, though, varies between 10.99% and 21% a year. The sum lent shall also be subject to a transaction fee. The tenure is up to five years.
How To Request a Government Loan
Here are few ways to apply for a start-up business loan are:
Visit the official website of the lender to order the loan by completing the form and submitting the required paperwork.
Visit the closest lender’s branch to have the form and documentation for the loan application.
You may also contact the customer service of the loan company to offer help for a start-up loan application.
A huge number of start-up firms live in India. The number of cottage industries and small units is increasing. However, start-ups and micro-industries need capital to grow, manage, and succeed in the global giant market. Since these units lack access to price raising, the Government has taken the lead to fund these small scale enterprises and facilitate them.
Hope this article helped all our budding entrepreneurs. For more such articles, do check our blog section!
Prime Minister Narendra Modi announced a Rs. 1,000 Crore seed fund for India Startups, to allow initial funding for startups. “This is going to help to launch and develop new businesses,” Modi said at the International Summit of Prarambh Startup India. Modi said, “India is trying to create a startup ecosystem based on the key principles of youth, youth, and youth.” The Government will also enable new companies to develop debt capital by providing guarantees.
PM Modi announced the Startup fund on 16th January, 2021
The GeM platform offers local startups the chance to take part in government tenders with large corporations. Modi reported that approximately 8,000 startups had so far registered and had done almost Rs 2,300 crore. He praised the startups for creating innovative solutions during the pandemic and for supporting the efforts of the government to normalize economic activity. More than 10 startups across sectors ranging from beauty to payments turned unicorn in 2020 against nine in 2019.
Startup Ecosystem facilitated through various Government Departments & Programs
4000+ Startups have benefitted in the last year through various programs of the Central Govt.
960 crore of funding has been enabled to Startups through various schemes.
With the objective to build a strong eco-system for nurturing innovation and startups in the country the Government launched a Startup India Action Plan that offers the following support to recognized supports through:
Tax Exemption
IT exemptions for 3 years
Capital gains exemption to people investing such capital gains in the Government recognized Fund of Funds
Tax exemption on investments above the Fair Market Value
A panel of facilitators to assist in filing applications, govt. bears facilitation costs: 423 facilitators for patent & design, 596 for trademark applications
80% rebate in filing of patents: 377 startups benefitted
Easy Compliance
Self-certification and compliance of 9 environments and labor laws through Startup India web portal/mobile app. Online self-certification for Labour Laws enabled through ‘Shram Suvidha’ portal.
Relaxed Norms for Public Procurement
By easing the requirement of prior experience and prior turnover in tenders for application by startups.
Fund of Funds
₹ 10,000 Cr. Fund of Funds to be provided by Mar 2025: Avg. ₹ 1,100 Cr. Per year
Operating guidelines has changed to incorporate the following:
– 2x of FFS to DIPP Startups Allow funding of the entity after ceasing to be the startup (under DIPP)
– 600 Cr (+25Cr Interest) given by DIPP to SIDBI which further committed Rs 623 Cr to 17 VC. 56Cr has been disbursed to 72 startups catalyzing investments of Rs 245 Cr
Collateral Free, Fund & Non-Fund Based Credit Support
Loans of up to 5 Cr. per Startup to be covered
Status: EFC Memo circulated on 22 March 2017 to 6 Departments
Impact: Credit guarantee to benefit 7,500+ Startups in 3 years
Industry/Academia Support
Providing and building infrastructure across the country by setting/scaling up: 31 Innovation Centers, 15 Startup centers, 15 Technology Business Incubators, 7 Research Parks, 500 Atal Tinkering Labs.
Government e Marketplace (GeM) is a government and agency online procurement platform and the most commonly used public procurement channel in India. MSMEs and DPIIT recognized startups can be used to register as sellers on GeM, and directly to government bodies to sell their goods and services. GeM Startup The runway is the latest initiative laid by GeM to empower businesses to enter the universe of government purchasers through the provision of creative, design, process, and operation-specific goods.
To apply to Startup India Seed Fund, here are a few steps you are required to follow:
1. Registration of the Company:
The company needs to register itself through the GeM Portal. In the website, it has instructed on how to register the company in the portal and to check if the company is eligible.
Fill the Form Correctly and Upload the appropriate Document then Submit the Application.
Name of the firm: Provide name of the business firm which shall be used to sell products and services on GeM Portal. Please note you must carry registration proof in the name of business firm.
Address of the Business firm: Provide the registered address of the business firm.
Nature of the Business: Describe the business activity of the firm such as the manufacturer of goods, service provider, retailer, wholesaler, distributor, etc.
List of Products & Services to be sell in GeM: Enter all the goods and services needed for public procurement in the GeM Portal. By separating commas, a company may join many products and services.
Owners Name: Enter the company owner’s name. In the case of a company, LLP, or partnership firm, you may enter any one authorized partner/director details.
Owner’s Aadhar Or PAN Number: Provide the 12 digits Aadhar Number of the business firm owner. In the case of a company, LLP, or partnership firm, you may enter any one authorized partner/director details.
Type of Firm: Select the nature of your business entity.
E-mail ID: Enter the email id of the owner or authorized director/partner.
Mobile Number: Enter the mobile number of the owner or authorized director/partner.
Bank Account Details: Provide complete bank details of the business the firm under which payment shall be received after goods/services public procurement or on completion of tender.
Date of Business Incorporation: Enter the date of the company/firm incorporation which shall be available in partnership deed or certificate of incorporation or other business registration certificate (in case of the sole proprietor).
Income Tax Incorporation: Select yes if the income tax return of the firm or owner (in the case of the sole proprietor) has been filed for any previous year. Else select No.
3. Online Payment: Make an online payment to process your application with our Secured Payment Gateway.
4. Schedule Call-back: Schedule a call back for validation
5. Validate and complete registration: To receive a call from the validation department and complete your registration.
Startups are excluded from specific selection requirements such as Prior Experience, Preview and Earnest Money Deposits. The incentive to consult with the government on trial request, making it more likely to introduce a new product. On GeM, purchasers may rate their product or ServiceNow more restrictive definitions for GEM, meaning the publication on the website of new and creative products.
Frequently Asked Questions
Can a foreign company register under Startup India hub?
Yes. Any company having at least on registered office in India can register on startup India hub as location preferences, for the time being are only created for Indian states. However, the government is working on international relations and will soon be able to enable registration for stakeholders from the global ecosystem.
How can I register a profile on the hub?
registering on the Startup India hub is very easy.
The “register” tab on the page will direct you towards “mygov” platform. On mygov you will be asked to fill details like name, email id etc. Then you will get an OTP for verification and a link to set a new password.
Sign in using the login credentials you created in step 1. This will direct you to the Hub where you can select and create the profile of a stakeholder which best defines your role.
How do we connect to enablers after creating a profile?
The system is build to connect you to your relevant stakeholders based on your industry and preferred stage. Under the profile of every enabler there will be an option to “connect/apply”. Upon clicking, a request will be sent to the respective profile for acceptance. Once accepted, you will able to see the enabler as a new connection.
Please note that you can connect with upto 3 users per week.
Rishabh Rathi
