Maharashtra dethrones Karnataka as start-up hub

India has created a total of 72,993 start-ups in six years from 2016 to 2022. These start-ups have created a total of 7,67,754 jobs so far, the Ministry of Commerce and Industry informed the Lok Sabha on Wednesday. This is as per the list of start-ups recognised by the Ministry’s Department for Promotion of Industry and Internal Trade.  

As per this data, Maharashtra has dethroned Karnataka as the start-up capital of India. While Maharashtra has 13,519 start-ups, Karnataka has 8,881 start-ups in the same period.  

Apart from Maharashtra and Karnataka, Delhi, Uttar Pradesh, Gujarat, Haryana, Kerala, West Bengal, Rajasthan and Madhya Pradesh have also created a large number of start-ups, from 2016 to 2022.    

Maharashtra scored on another parameter over other states: job creation via start-ups. The state created 1,46,132 jobs through start-ups as on June 30, 2022. Besides Maharashtra, states like Karnataka, Delhi, Uttar Pradesh, Telangana and Tamil Nadu also created a large number of jobs through the avenue of start-ups.  

As per the data presented by the Commerce and Industry Ministry in the lower house, 20,160 start-ups were created in 2021 — the highest so far. When asked about a database on the investments raised by these start-ups, the Ministry said that the government does not have any centralised compilation of information regarding the same.  

But what has the government done so far to aid the rise of the growing startup ecosystem in India? The Ministry laid down the number of initiatives taken by government, including schemes such as the  Start-up India Action Plan, Fund of Funds for Start-ups (FFS) Scheme, Start-up India Showcase, Start-up India, National Start-up Advisory Council, Start-up India Seed Fund Scheme (SISFS) and other regulatory reforms.  

Under the FFS Scheme, a corpus of Rs 10,000 crore is likely to be provided over the 14th and 15th Finance Commission cycles, based on the progress of the scheme and availability of funds. The FFS Scheme, aimed at meeting the funding needs of start-ups, “has not only made capital available at an early stage, seed stage and growth stage but also played a catalytic role in terms of facilitating raising of domestic capital, reducing dependence on foreign capital and encouraging home grown and new venture capital funds,” as per the Ministry.

Start-up India Action Plan, on the other hand, comprises of 19 actionable items across areas like simplification and handholding, funding support and incentives and industry-academia partnership and incubation.  

Funds worth Rs 945 crore have been sanctioned under the Start-up India Seed Fund Scheme (SISFS) for a period of four years, beginning 2021-22. The government has undertaken 52 reforms since 2016 to enhance the ease of doing business, ease of raising capital and reduce compliance burden to encourage the start-up ecosystem, the Ministry highlighted.