Startup India Backs Over 2.5 Lakh Startups, Generates More Than 25.42 Lakh Jobs: Government

The department said a series of policy and regulatory reforms aimed at reducing compliance burdens and improving ease of doing business has helped shift India’s business environment from a permission-based system towards a trust-based framework. These measures have supported startup growth, investment, employment generation and the delivery of digital services.

According to the Ministry of Commerce and Industry, nearly 52 per cent of recognised startups are located in non-metropolitan cities, highlighting the spread of entrepreneurship beyond major urban centres. Women’s participation is also reflected in the ecosystem, with 48 per cent of recognised startups having at least one woman director.

Government Funding Schemes Expand Startup Financing

Government-backed funding programmes have played a key role in improving access to capital for early-stage ventures and growing businesses.

Under the Startup India Seed Fund Scheme, more than ₹775 crore has been approved for over 4,100 startups through 244 incubators operating across 32 states and Union Territories.

The Fund of Funds for Startups, managed by the Small Industries Development Bank of India (SIDBI), has committed more than ₹12,600 crore to alternative investment funds. These funds have subsequently invested over ₹28,000 crore in nearly 1,500 startups.

Meanwhile, the Credit Guarantee Scheme for Startups has supported more than 500 loans amounting to ₹1,662 crore. The beneficiaries collectively employ over 41,000 people.

To further strengthen access to credit, the government has doubled the guarantee cover available to startups from ₹10 crore to ₹20 crore. It has also reduced annual fees for priority sectors to ease financing costs.

Tax Reforms and Investment Measures Aim to Encourage Growth

DPIIT highlighted several policy changes intended to improve the investment climate and reduce the financial and regulatory burden on businesses.

These include the abolition of angel tax, rationalisation of capital gains taxation for listed and unlisted shares, and permission for institutional investors—including insurance companies and retirement funds—to invest in alternative investment funds.

The government has also expanded access to tax benefits for eligible startups. More than 4,400 startups have received eligibility certification under Section 80-IAC.

The measures are intended to encourage investment, improve capital availability and support businesses as they move from early-stage operations towards expansion.

Startup Participation in Government Procurement Rises

Government procurement has emerged as another avenue for startups seeking customers and opportunities to scale their businesses.

The number of startups registered on the Government e-Marketplace (GeM) has increased from fewer than 8,000 in 2021 to more than 43,000. Public buyers have placed cumulative orders worth over ₹68,000 crore through the platform.

The expansion has widened startups’ access to public-sector procurement opportunities, allowing more businesses to compete for government contracts through a digital marketplace.

Nearly 48,000 Compliance Requirements Reduced

Alongside startup-specific initiatives, the government has pursued broader regulatory reforms to simplify business operations.

According to the ministry, nearly 48,000 compliance requirements have been reduced across central ministries and state governments. More than 22,000 compliances have been digitised, while thousands of others have been simplified, decriminalised or eliminated.

The Jan Vishwas Acts have decriminalised 900 provisions under central laws, with the stated objective of reducing the threat of criminal penalties for certain regulatory violations and improving the ease of doing business.

The government said these reforms form part of a wider effort to create a business environment that encourages entrepreneurship, investment and job creation while reducing unnecessary procedural hurdles.