Q.What is 'Startup India' ?

Startup India is the Central Government's umbrella initiative, launched on 16 January 2016 and administered by the Department for Promotion of Industry and Internal Trade (DPIIT), to build a strong ecosystem for innovation-driven new enterprises in the country.

An eligible enterprise can apply for DPIIT recognition as a 'startup', and recognition is what unlocks the scheme's main benefits. The first is a tax exemption for three consecutive financial years out of the first ten years since incorporation, available under Section 80-IAC of the Income Tax Act, which gives a young company more retained earnings to reinvest during its most cash-constrained years. The second is access to capital through the Fund of Funds for Startups, a corpus that the government operates through SIDBI; rather than investing directly in individual startups, this fund invests in registered venture capital funds, which then invest in startups — an indirect route meant to draw in much larger amounts of private venture capital alongside the government's own contribution. The third benefit is simplified, self-certification-based compliance under specified labour and environment laws, which reduces the time and cost a new company spends on routine regulatory filings in its early years. …