Accelerating the Growth of Start-ups Through a Business-friendly Economy

Gone are the days when starting one’s own business was seen as a path to self-inflicted failure or so to say ’suicidal’. From being a business-skeptic society towards becoming a start-up driven economy, India has come a long way in terms of a paradigm shift in its approach towards starting and doing business. We, as a society, have started to appreciate the tenets of entrepreneurship, which involves risk, courage and above-all, a belief in one’s idea and ability to execute it.

However, it is not enough for the entrepreneurs to have only the right aptitude and attitude to succeed in establishing a business venture. A favorable business environment comprising the right policies executed through easier procedures of starting and closing down businesses, tax incentives for start-ups to help them establish and scale-up fast, and an investor-friendly economy that attracts and welcomes domestic and foreign investments are necessary and critical for the growth and evolution of the country’s start-up ecosystem.

To address this issue the Start-up India campaign was launched by the Government early this year to create an enabling environment for start-ups and kickstart a national movement towards entrepreneurship and self-employment. Some of its key objectives are: simplifying compliance requirements for start-ups and introduction of self-certification; creating a Start-up Hub as a single point of contact for the entire ecosystem; providing access to high quality IPR services; offering relaxed norms for start- ups in public procurement, among others.

Under the Atal Innovation Mission, the objective of the Government is to support and promote Innovation in Science & Technology (S&T) focused programmes for students in schools and colleges. It also aims to serve as a platform for creation of world-class Innovation Hubs, Grand Challenges, start-up businesses and other self-employment activities, particularly in technology driven areas.

With support from both the Government and the Industry, convergence of technology and enterprise can act as a stimulus for improved productivity, economic growth, greater inclusion and societal benefit. In the last few years, there has been great proliferation of data science and tech- based businesses, for example, tech-based aggregator model enterprises are leading to a kind of ‘urbanisation of society’ where a rising number of ventures are adopting the aggregator business model of connecting the buyers and sellers.

The recent demonetisation drive by the Government of India has been significant. While it was principally aimed towards arresting the flow of black money and corruption in the economy, it has slowly been geared for creating a large momentum towards adoption of a less-cash digital economy. This seminal policy shift holds the potential to trigger a fintech revolution in the country. If implemented effectively, this would lead to a scale of financial inclusion unheard of in the history of mankind. People at the bottom of the pyramid would be empowered to do online transactions, using Aadhar card, Mobile handset, Point of Sale (PoS) machines, among a host of methods. This will enable transparency in doing business, especially for start-ups and help them avoid financial malpractices.

Lastly, the area where a significant amount of work needs to be done is the Industry- Academia partnership model, to build a culture of innovation through collaborations.

A nation as big as India needs large and accessible mentorship platforms to enable innovators to undertake entrepreneurship as their favored career option. CII has been partnering with the Department of Science and Technology (DST), Government of India and the All India Council for Technical Education (AICTE) for the last nine years on India Innovation Initiative (i3), which is a national challenge organized every year to reward India’s most promising individual grassroots innovators and facilitate commercialization of their innovations through mentoring and incubation support and investor connect.

As a significant part of its work in developing the start-up ecosystem in India, CII set up the National Start-up Centre in Amravati in partnership with the Andhra Pradesh Government. The centre will support both IT and non-IT based start-ups, especially start- ups initiated by rural youth. It will offer a range of services like support during pre-incubation, incubation and post-incubation, and growth/ capacity-building programmes, among others.

CII organizes the Start-ups Awards to recognize and honor India’s most innovative start-ups and give them an opportunity to be known for their innovative products and services.

Both Government and corporate sector should support bigger networking platforms for entrepreneurs to help them strengthen the start-up industry connect. CII, jointly with the Ministry of Skill Development and Entrepreneurship, organizes the Start-up Conclave with the objective of providing a national-level platform to a wide array of Indian start-ups to showcase their products and services, talk about their innovation and get an opportunity to partner with Industry for funding, procurement and mentoring support.

More and more funding platforms need to be created for young people (with small savings/capital) to take up entrepreneurship. The recently launched, CII Start-up Coalition, acts as a one-stop-online-platform for customized services for start-ups such as assessing investment worthiness, mentorship, and access to incubators.

All these initiatives are to help an evolving economy move towards an innovation-led entrepreneurship eco-system, whose time has come; we shall ignore it at our own peril.

Source : CII Policy Watch February 2017

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