Executive Summary:
This document is the response to Lok Sabha Unstarred Question No. 4149 regarding the promotion of private investment in startups under the Startup India initiative. It details steps taken by the government, funds sanctioned, regulatory reforms, and the inclusion of startups in the GeM Startup Runway, as of June 30, 2025.
Key Points / Main Content:
Fund of Funds for Startups (FFS) Scheme:
* SIDBI manages the FFS scheme, providing capital to SEBI-registered AIFs.
* AIFs must invest at least two times the amount committed under FFS in startups.
* SIDBI has committed Rs. 9,994 crore to over 140 AIFs.
* Supported AIFs have invested approximately Rs. 23,679 crore in 1,282 startups.
Startup India Seed Fund Scheme (SISFS):
* Provides funding to startups in their early stages through incubators.
* The Experts Advisory Committee (EAC) selects incubators for fund allocation.
* Rs. 945 crore has been approved for 219 incubators.
Regulatory Reforms for Ease of Doing Business:
* Government initiatives include the Business Reform Action Plan, Jan Vishwas, and Reducing Compliance Burden on Businesses and Citizens.
* Measures involve simplification of procedures, rationalization of laws, digitization, and decriminalization of minor defaults.
* Over 60 measures have been taken specifically for the startup ecosystem, including profit-linked deductions, compliance relaxations, and faster exit provisions.
GeM Startup Runway:
* GeM has developed GeM Startup Runway, a dedicated marketplace for startups.
* 205 recognized startups are included in GeM Startup Runway.
Impact Analysis:
Startups:
* Impact: Benefit from increased funding opportunities, regulatory ease, and a dedicated marketplace on GeM.
* Action Required: Utilize available funding schemes, adhere to simplified regulations, and leverage the GeM Startup Runway to sell to the government.
Alternative Investment Funds (AIFs):
* Impact: Receive capital from SIDBI under the FFS scheme.
* Action Required: Invest at least two times the committed amount in startups and comply with SEBI regulations.
Incubators:
* Impact: Receive funding under the SISFS to support early-stage startups.
* Action Required: Apply for funding, select eligible startups according to scheme guidelines, and provide necessary support.
Small Industries Development Bank of India (SIDBI):
* Impact: Operationalizes the FFS scheme by providing capital to AIFs.
* Action Required: Manage the allocation of funds effectively and monitor investments made by AIFs.
Government eMarketplace (GeM):
* Impact: Provides a dedicated platform for startups to list and sell their products/services to the government.
* Action Required: Maintain and promote the GeM Startup Runway.
Government:
* Impact: Implementing initiatives to promote private investment and ease of doing business for startups.
* Action Required: Continue monitoring and refining policies and schemes to support the startup ecosystem.
Key Entities Referenced
Startup India: A Government of India initiative to promote startups.
Fund of Funds for Startups FFS Scheme: A scheme under Startup India to catalyze private venture capital investments, operationalized by SIDBI.
Small Industries Development Bank of India SIDBI: The entity operationalizing the Fund of Funds for Startups (FFS) Scheme.
Securities and Exchange Board of India SEBI: Regulatory body for Alternative Investment Funds (AIFs) that invest in startups.
Alternative Investment Funds AIFs: Funds registered with SEBI that receive capital from SIDBI under the FFS scheme and invest in startups.
Startup India Seed Fund Scheme SISFS: A Government scheme providing funding opportunities to startups in their early stages of growth.
Government eMarketplace GeM: An online platform for startups to list their products and services and sell directly to the Government.
GeM Start up Runway: A dedicated marketplace category within GeM exclusively for startups.
GOVERNMENT OF INDIA
MINISTRY OF COMMERCE & INDUSTRY
DEPARTMENT FOR PROMOTION OF INDUSTRY AND INTERNAL TRADE
LOK SABHA
UNSTARRED QUESTION NO. 4149.
TO BE ANSWERED ON TUESDAY, THE 19TH AUGUST, 2025.
PROMOTING PRIVATE INVESTMENT IN STARTUPS
4149. SMT. MANJU SHARMA:
Will the Minister of COMMERCE AND INDUSTRY be pleased to state:
वाणिज्य एवं उद्योग मंत्री
(a) the details of the steps taken/being taken by the Government to promote private
investment under Start-up India initiatives;
(b) the details of the amount sanctioned under the Start up India Lead Fund
scheme;
(c) the regulatory reforms undertaken by the Government to enhance ease of doing
business, raising capital and to reduce compliance burden for recognised Start-
ups; and
(d) the number of recognised start-ups included in GeM Start up Runway in a year?
ANSWER
वाणिज्य एवं उद्योग मंत्रालय में राज्य मंत्री (श्री णिणिन प्रसाद)
THE MINISTER OF STATE IN THE MINISTRY OF COMMERCE & INDUSTRY
(SHRI JITIN PRASADA)
(a): The Fund of Funds for Startups (FFS) Scheme under Startup India initiative,
has been established to catalyze private venture capital investments and is
operationalized by Small Industries Development Bank of India (SIDBI), which
provides capital to Securities and Exchange Board of India (SEBI)- registered
Alternative Investment Funds (AIFs) which in turn invest in startups. AIFs
supported under FFS are required to invest at least two times of the amount
committed under FFS in startups. Under the Scheme, SIDBI has made net
commitments of Rs. 9,994 crore to over 140 AIFs and the supported AIFs have
invested around Rs. 23,679 crore in 1,282 startups as on 30th June 2025.
(b): The Government is implementing Startup India Seed Fund Scheme (SISFS) to
provide funding opportunities to startups in their early-stages of growth.
The Scheme provides financial assistance to eligible startups through
incubators. The Experts Advisory Committee (EAC) of SISFS, evaluates and
selects incubators for allocation of funds which thereon select startups in
accordance with the Scheme guidelines. Rs. 945 crore has been approved to
219 incubators selected under the Scheme as on 30th June 2025.(c): For simplifying and streamlining business regulations and fostering ease of
doing business across the country, the Government is undertaking various
measures through initiatives such as Business Reform Action Plan, Jan
Vishwas, and Reducing Compliance Burden on Businesses and Citizens.
These measures include simplification of procedures related to applications,
renewals, inspections, filing records, etc.; rationalization by repealing,
amending or subsuming redundant laws, digitization by creating online
interfaces eliminating manual forms and records, and decriminalization of minor
technical or procedural defaults.
Specifically for the startup ecosystem, the Government has taken more than 60
measures to enhance ease of doing business, raising capital and reducing
compliance burden. These measures include profit linked deductions under
Section 80-IAC of the Income Tax Act 1961, relaxation in compliances,
carryforward of losses, fast-track approval process for in-bound mergers, faster-
exit provisions, relaxation in public procurement, etc.
(d): Government e-Marketplace (GeM) has developed GeM Startup Runway, a
dedicated marketplace category exclusively for startups to list their products
and services and sell directly to the Government. 205 recognised startups are
included under GeM Startup Runway as on 30th June 2025.
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