Government plans to announce measures to strengthen India’s startup ecosystem in Union Budget
- ByStartupStory | January 27, 2023
According to official sources, the government is expected to announce steps in the upcoming Budget to further strengthen the country’s startup ecosystem and address inverted duty issues in certain sectors to promote domestic manufacturing.
Fiscal incentives under the production linked incentive (PLI) scheme are also expected to be announced in the Budget, which will be presented on February 1.
Furthermore, the government may consider funding infrastructure projects approved by the PM Gati Shakti initiative’s Network Planning Group (NPG), they said.
Prime Minister Narendra Modi launched the Gati Shakti – National Master Plan on October 13, last year, with the goal of developing integrated infrastructure to reduce logistics costs.
For unified planning and integration of proposals, the NPG has representation from various connectivity infrastructure ministries/departments, including their heads of network planning division.
Before creating a DPR (detailed project report) at the planning stage, all of these departments seek approval from the NPG.
Inverted duty structure refers to taxing inputs at higher rates than finished products, resulting in credit accumulation and cascading costs.
The government has already taken a number of steps to encourage the growth of startups in the country. The Startup India initiative implements the Fund of Funds for Startups (FFS) scheme, the Startup India Seed Fund Scheme (SISFS), and the Credit Guarantee Scheme for Startups (CGSS) to provide capital at various stages of a startup’s business cycle.
In January 2016, the government launched the Startup India initiative with the goal of creating a strong ecosystem for nurturing innovation and encouraging private investment in the startup ecosystem.
“The commerce and industry ministry has suggested steps to further promote ease of doing business for startups,” one of the sources said.
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