Critically examine the salient features of start-up ecosystem in India while focussing on recent government initiatives in this direction.

The initiative regarding start-up is not new in India and from ancient time period cottage industries period to current highly knowledge start-up industries in various fields showed big potential in India. But post Independence, Inspector Raj and other non-clear regulations (tax, red-tape process for start-up, funding problem, corruption) could not create conducieve environment. To fill the gaps, NDA government initiated new Action plan.

 
There are new 19 actions plans to create conducive ecosystem for startup in four dimensions 

  1. Simple Rules
  2. Process and Compliance 
  3. Tax sops 
  4. Funding and other initiatives example incubators in National Institutes, innovation support at school and other colleges.

=> Funding management should be transparent, non-ambiguous. Since India is at 3rd position in start-up setting up there should be enough fund available. Fraud handling case is big challenge. 
=> Without improving standard of education in schools,colleges and universities start-up program difficult to achieve its real target. 
=> More emphasis on technology (e-commerce industries already have enough fund) while other sectors like agriculture needed much fund support. 
=> More emphasis on innovation while many industries where need marginal innovation, should give importance. 
=> Supportive Infrastructure like electricity, safety and specially rural area is more on outside of this program. 
=> Forex regulation is big challenge which forced many companies to register outside like Flipkart registered in Singapore. 
 
On the other note, India have demographic dividend and potential in lead the world in technology along with innovation. Thus start-up program can provide a such platform. This can be big milestone in creating employment when manufacturing is contracting under global risk.  Thus start-up ecosystem action plan is great initiative at right time. 
 
Government should improve universities environment for education base on industry and competitive with global standard. There should have plan to mobilise village youth for technology and rural problem solutions. The PPP model should implement with new recommendation of Kelkar committee with private field experts. 

Question for UPSC Mains:
Critically examine the salient features of start-up ecosystem in India while focussing on recent government initiatives in this direction.

Published: March 2, 2016 | Modified:June 27, 2019

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