Start-ups in India

Start-ups in India

Why in the News?                                      

The recognized start-ups in India approximating to 98,000 have created 10.34lakh direct jobs in India excluding the jobs created in related sectors such as e-commerce, fintech, EdTech, etc.,

The Indian Start-up Ecosystem:

1. India has become the third largest startup ecosystem in the world.
2. The CAGR of the number of recognized startups in India between 2016-22 increased up to 142%.
3. At least one startup is present in each of the 36 States/UTs.
4. India is also home to more than 100 Unicorns and 23 of them emerged in 2022 itself.

Key categories of Startups in India:

Factors fueling the growth of Startup ecosystem:

1. Growing internet penetration along with proliferation of affordable smartphones and extremely affordable data plans. This led to attraction of more active and technology-savvy digital users across sectors such as ecommerce, consumer services, fintech and enterprise tech.

2. Growing Investor Ecosystem plays a pivotal role in nurturing entrepreneurship and the startup culture.

3. Growing Per Capita Income noticed a surge of 65% over the past decade. This has increased the consumption expenditure of people and also enabled people to experiment new products and services.
4. Govt policies and Schemes:
   1. The Startup India initiative
   2. Fund of Funds scheme for the startups (FSS)
   3. Startup India Seed Fund Scheme (SISFS)
   4. Credit guarantee Scheme for Startups.

Key challenges faced by the Indian Startup ecosystem:

1. 5. Inadequate Ecosystem for Hardware Startups ever since the 1992 LPG reforms that focused on tertiary sectors especially in IT/BPO service industries.
   6. High capital expenditure required to setup new business in the hardware sector makes it difficult to attract venture capital investments.

1. 7. Low Investor Confidence Towards Deep-tech Startups due to factors such as,
      1. Low adoption of deep-tech technologies such as 3D printing, IoT and IoT, and robotics
      2. Lack of adequate R&D culture in India
   8. Low number of patent applications filed in India due to less spending on R&D and Innovation. For instance, China Filed 26x More Patent Applications Than India in 2019.
   1. Enforcement of patent laws is a major hurdle limiting the scope of intellectual property in the country.
   10. Stringent regulatory constraints.

For instance, The Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021 has been implemented to address the privacy concerns of the citizens. But a possible censorship may also affect the freedom of expression, the biggest selling point of OTT content.

Link: Recognised start-ups have created over 10.34 lakh direct jobs: Piyush Goyal- The New Indian Express