India’s startup ecosystem has seen unprecedented growth over the past decade, with official recognition of startups by the Department for Promotion of Industry and Internal Trade (DPIIT) rising from a modest 500 in 2016 to an impressive 180,683 startups as of June 30, 2025. This announcement was made by Minister of State for Commerce and Industry, Mr. Jitin Prasada, highlighting the government’s continued efforts to promote innovation, entrepreneurship, and self-reliance in the country.

Under the Startup India Action Plan, recognised startups are eligible for a range of fiscal incentives, including income tax exemptions and easier compliance norms. These benefits are designed to encourage entrepreneurs to build scalable businesses while contributing to India’s economic growth.

The government’s support extends through several flagship financial schemes aimed at strengthening the funding pipeline for startups:

1. Fund of Funds for Startups (FFS):
   The FFS, managed by the Small Industries Development Bank of India (SIDBI), invests in Alternative Investment Funds (AIFs) that, in turn, invest in startups. As of June 30, 2025, AIFs backed by FFS have invested Rs. 23,679 crore (US$ 2.70 billion) into 1,282 startups across various sectors. This approach not only provides capital but also ensures that startups benefit from the expertise and mentorship provided by experienced fund managers.

2. Startup India Seed Fund Scheme (SISFS):
   This scheme supports seed-stage startups by providing financial assistance through incubators. The incubators, under SISFS, have selected 2,942 startups and approved funding of Rs. 522.42 crore (US$ 59.62 million) by June 30, 2025. These funds help early-stage businesses develop prototypes, conduct market entry activities, and scale operations.

3. Credit Guarantee Scheme for Startups (CGSS):
   Designed to help startups access loans without collateral, CGSS had guaranteed 289 loans worth Rs. 667.85 crore (US$ 76.21 million) by June 30, 2025. This initiative provides banks and financial institutions with greater confidence to lend to startups that might otherwise be considered high-risk.

The combination of these schemes has played a significant role in ensuring that entrepreneurs have access to capital, mentorship, and market linkages at every stage of their journey.

Apart from startup recognition and funding, Mr. Jitin Prasada also highlighted achievements in Geographical Indication (GI) tagging. As of August 1, 2025, India has 697 GI-tagged products, of which 658 are from India and 39 from foreign countries. These tags are crucial for protecting the cultural and commercial value of traditional products, ranging from agricultural produce to handicrafts and industrial goods. Additionally, 659 GI applications are currently pending before the registry.

The exponential growth in startup recognition reflects India’s transformation into one of the world’s leading startup hubs. Driven by a young workforce, a growing digital infrastructure, and proactive government policies, the ecosystem is fostering innovation across industries like fintech, agritech, healthtech, edtech, and clean energy.

Experts believe that the continued success of this ecosystem will depend on:

• Consistent policy support to reduce bureaucratic barriers and simplify compliance.

• Greater access to international markets through trade pacts and cross-border collaborations.

• Focus on emerging technologies like artificial intelligence, deeptech, semiconductor manufacturing, and green energy.

With strong government backing and growing investor interest, India’s startup sector is poised to play a pivotal role in driving GDP growth, generating employment, and enhancing the country’s global competitiveness.

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