The government is open to tweaking its startup policy as it aims to nurture indigenous innovation and create new avenues of providing employment, minister of state for finance Jayant Sinha said, according to this report.
The report quotes Sinha saying that as policy making is a dynamic process, it can’t be stopped. He said if a problem is brought to their notice, they can fix it.
Sinha also stressed on the importance of three vectors that would enable the transformation of India — namely Internet, mobile and green technology, and transportation. He explained that all of them are interlinked and technology is the secret sauce for India’s transformation.
After announcing the ‘Startup India, Stand Up’ initiative to boost startups in India, PM Narendra Modi set the ball rolling with the startup action plan last month. He released a 30-page action plan that makes the journey smoother for startups and helps them grow.
The industry welcomed the initiative but faced criticism too for not having enough insights into the industry and lack of clarity. The Financial Express points out the instance of the clause that says the government would exempt startups from paying income tax for first three years, while critics say no startup actually makes money in the first three years so there’s no question of paying taxes.
To look at some other clauses mentioned in the policy, they are with respect to compliance and patent protection. For instance, startups can self-certify their compliance with environment and labour laws and there would be no inspection for three years.
For patent protection, the government would set up a panel of legal facilitators that would help file patents. It would also make the process of filing for patents easier and transparent.
The government also plans to relax registration procedures for startups. Startups will get 90 days open window to close their businesses in case of failure. A fund of Rs 10,000 crore is planned for the growth and development of the startups. It will be an infusion of Rs 2,500 crore a year. In case a start-up is looking to shut down operations, then a person in charge of the company will be appointed and the assets of the company will be liquidated and its creditors paid within six months.