Startups worldwide have struggled with a funding shortage for the past year and a half, commonly referred to as the “Startup Funding Winter.
” Fortunately, relief may be on the horizon for new companies in India as the government works on a scheme to provide investment to startups.
Challenges Faced by Startups
Indian startups have not been immune to the challenges posed by this funding crunch. Many startups found it difficult to survive due to a lack of funds.
Some were forced to close their doors, while others had to resort to drastic cost-cutting measures, including large-scale layoffs.
In response to these issues, the government is formulating a new plan.
The Government’s Strategy
The government’s strategy, as reported by ET, aims to inject much-needed investment into the burgeoning startup ecosystem in India and address the challenges it faces.
To achieve this, the Department for Promotion of Industry and Internal Trade (DPIIT) is working on developing various criteria to assess startup performance.
These criteria encompass factors such as investment, the number of startups within a sector, and job creation.
Addressing Key Issues
An official revealed that the government is committed to meeting its objectives within the set timeframe.
The comprehensive plan seeks to identify and tackle challenges related to regulatory approvals, taxation, ease of doing business, and the global expansion of Indian startups.
Additionally, the government aims to address issues that deter companies, high net worth individuals, and other investors from putting their money into startups.
Reviving Startup India
In 2016, the central government launched Startup India to foster the growth of the startup ecosystem in the nation.
Now, the government intends to reinvigorate this seven-year-old initiative.
As of April 20, 2023, DPIIT has already recognized 98,119 startups under this scheme, demonstrating the program’s potential to drive innovation and entrepreneurship in India.
