Definition of a startup under the Startup India scheme revised; benefits to be applicable up to 7 years

In order to make it easier for ventures to avail of incentives and promote entrepreneurship, the government had, on Thursday, revised its definition of a startup under the Startup India scheme.

(1/4) Key changes made to the definition of #startups, process of recognition made simpler under https://t.co/mFHMFDPYiK #StartupIndia

— Startup India (@startupindia) May 26, 2017

According to the Department of Industrial Policy and Promotion (DIPP), the revised terms now states that an entity will now be considered a startup up to 7 years, from the date of its incorporation/registration – extended from previously 5 years. This has been in done keeping in mind the gestation period involved in establishing a startup.

The scope of definition was also widened to include scalability of business model with potential of employment, with potential wealth creation and employment generation.




However, startups in the biotechnology sector get a period of up to 10 years from the date of incorporation/registration.

(3/4) Organizational age for #startups is now 7 years; for biotechnology #startups 10 years #StartupIndia

— Startup India (@startupindia) May 26, 2017

The DIPP further added that startups would not require a letter of recommendation from an incubator or industry association any more to avail of tax benefits or recognition under Startup India.

(2/4) Letter of recommendation not required anymore! Neither for recognition, nor for availing tax benefits #StartupIndia

— Startup India (@startupindia) May 26, 2017

The statement goes on to explain that the DIPP has been in constant engagement with stakeholders to facilitate the start-up ecosystem and the revisions were done to ensure ease in starting a new business and “to promote the start-up ecosystem and build a nation of job creators, instead of job seekers.”

(4/4) To promote #startup, criteria of improvement of products/services, scalability, employment & wealth creation included in definition.

— Startup India (@startupindia) May 26, 2017

Prime Minister Narendra Modi had launched the the Startup India campaign in January 2016 with the an aim of nurturing innovation and to drive employment opportunities and economic growth.