Private incubators may soon be able to certify startups

According to reports, the Department of Industrial Policy and Promotion (DIPP) is in the process of issuing a notification that would soon allow private incubators to certify startups. Presently, only those incubators funded by the government or is established in a post-graduate college is permitted to certify Startups.

Sources in the department say that the eligibility norms for the incubators will be soon finalised, which will widen the incubators base in the country. Looking at the number of job opportunities startups create, the government is eager to fill up the scarcity of incubators in the country and boost the growth of startups.

An incubator basically provides infrastructure where multiple startups are given space to operate and mentored to scale up their business to a certain level. During the launch of the Startup India action plan, DIPP had put up a strict definition of a startup but incubators were not defined then.


According to the contours of the definition discussed, incubators will need to have specified physical infrastructure as well as mentors enrolled with the organisation to be eligible. DIPP has started the exercise of mapping incubation centres across the country with a special focus on tier two and three cities. It also plans to identify 10 incubators to evaluate them on pre-defined KPIs and provide them Rs 10 crore each to ramp up infrastructure.

Out of the 200 start-ups that have applied for availing the tax benefits up till now, about 30 were shortlisted and only one company made the cut for final approval by the inter-ministerial board set up by the DIPP. 10 companies have been asked for further details, in order to be considered for benefits.

Under the Atal Innovation Mission, the government has plans to create sector-specific incubators along with 500 tinkering labs to promote entrepreneurship, provide pre-incubation training and a seed fund for high-growth startups as part of Startup India action plan, which was announced by PM Narendra Modi in January this year.

The DIPP has also asked industry bodies to invest in incubators as part of their corporate social responsibility.