Entrepreneurship

Development and
Government

Module 4
 Content:
Entrepreneurship Development and Government:
• Role of Central Government and State Government in promoting
Entrepreneurship -
• Introduction to various incentives,
• Subsidies and grants
• Export Oriented Units
• Fiscal and Tax concessions available
• Start Up India scheme.
• Women Entrepreneurs –
• Reasons for low women Entrepreneurs
• Prospects for Women Entrepreneurs
• Strategies to motivate entrepreneurship amongst women.
• Institutions supporting Entrepreneurs –
• A brief overview of financial institutions in India - SIDBI -
NABARD - IDBI - SIDCO - Indian Institute of Entrepreneurship -
DIC - Single Window
• Latest Industrial Policy of Government of India
 Women
Entrepreneur:
• Women entrepreneurs may be defined as the women or a
group of women who set up and operate her own
enterprise.
• In other words, women entrepreneurs are self-employed
individuals who establish their enterprise and involve
themselves for economic activities.
• In short, women entrepreneurs are those women who
think of a business enterprise:
• initiate it,
• organise it,
• combine factors of production,
• operate the enterprise,
• undertake risks and
• handle economic uncertainty involved in running it.
 According to Government of India,:

Definition of
women “A Woman enterprise is the one owned and controlled by a woman
having minimum financial interest of 51% of the capital and giving at

entrepreneu least minimum 51% of generated employment to women”.

r:
According to J. Schumpeter:

“Women who innovate, initiate or adopt business actively are called

women entrepreneurs.”
Need

• To become economically independent

• To establish their own enterprise
• To establish their identity in the society
• To achieve excellency in their endeavour
• To build confidence to themselves
• To develop risk assuming ability
• To claim equal status in the society
 Features of women
entrepreneurs
1. Most women with small income are likely to become entrepreneurs
2. Women with small facilities are likely to become entrepreneurs
3. A majority of women entrepreneurs are married. With the support of their
husband they accepts entrepreneurship.
4. They find difficulties in obtaining financial support to start their enterprises.
5. A large number of women with little or no education and training enter into
the business field.
6. Many women become entrepreneurs out of economic necessity.
7. Women’s sincerity and hard work is the cause for sustainability and growth.
8. Women entrepreneurs are security oriented rather than growth oriented
9. Most women prefer stabilization of income and minimization of risk
Reasons for low women
Entrepreneurs
(problems/challenges faced by
women entrepreneurs)
1. Social Norms and Stereotypes
2. Limited access to capital
3. Lack of Supportive Ecosystem
4. Balancing Family and Business(WLB)
5. Discrimination/ Gender bias
6. Limited Access to Markets
7. Legal Constraints
8. Lack of Role Models
9. Limited Access to Technology
10. Lack of Confidence
11. Cultural Attitudes
12. Lack of Education and Training
13. Family Pressure
 Increased Access to Funding.

Rising Support Networks

Government Policies and Incentives

Prospects for
Women Growing Market Opportunities

Entrepreneurs Social Change and Advocacy

Work-life Balance Innovation

Collaboration and Partnerships

Consumer Trust and Brand Loyalty

 Education and Skill Mentorship and
Development Role Models

Strategies to
motivate Networking
Access to Funding
entrepreneursh Opportunities

ip amongst
women. Supportive Policies Awareness
and Infrastructure Campaigns

Technology and Recognition and

Innovation Awards
Role of Central Government and
State Government in promoting
Entrepreneurship
Role of Central Government
• Startup India Initiative
• Make in India
• MSME Support
• Digital India
• Atal Innovation Mission
• National Skill Development Mission
• Stand-Up India Scheme
• Ease of Doing Business
contd...
• Startup India Initiative: Launched in 2016, it aims to create a robust startup ecosystem by providing benefits like tax
exemptions, easier compliance, and access to funding.
• Make in India: Encourages manufacturing within the country, providing incentives for startups in the manufacturing sector.
• MSME Support: The Ministry of Micro, Small and Medium Enterprises (MSME) offers credit, marketing support, and skill
development programs for entrepreneurs.
• Digital India: Supports tech startups through improved digital infrastructure and e-governance initiatives.
• Atal Innovation Mission (AIM): Fosters innovation and entrepreneurship through Atal Incubation Centres (AICs) and Atal
Tinkering Labs (ATLs).
• National Skill Development Mission: Aims to create a skilled workforce that can contribute to entrepreneurship and
startups.
• Stand-Up India Scheme: Provides loans to women and SC/ST entrepreneurs to promote inclusivity in entrepreneurship.
• Ease of Doing Business: Central Government reforms to reduce regulatory burdens and improve the ease of starting and
running businesses.
Role of state Government
• State-Specific Startup Policies
• State Incubation Centers
• Land and Infrastructure Support
• Ease of Local Regulatory Compliance
• Skill Development Programs
• Financial Assistance and Subsidies
• Industry-Specific Clusters
• Collaboration with Central Schemes
Contd...
• State-Specific Startup Policies: Many states have their own startup policies with incentives like grants,
subsidies, and tax benefits tailored to local needs.
• State Incubation Centers: States establish incubation centers and innovation hubs to provide resources
and mentorship to startups.
• Land and Infrastructure Support: States often provide land at subsidized rates, co-working spaces, and
other infrastructure to startups.
• Ease of Local Regulatory Compliance: States simplify local regulatory processes to help entrepreneurs
set up and operate businesses with less hassle.
• Skill Development Programs: State governments run local skill development programs to align with the
needs of regional industries and startups.
• Financial Assistance and Subsidies: Some states offer financial aid, subsidies, and low-interest loans
specifically for startups.
• Industry-Specific Clusters: States may develop industry-specific clusters or parks (like IT parks, biotech
hubs) to promote sectoral growth.
• Collaboration with Central Schemes: States often collaborate with Central Government schemes,
enhancing their impact through regional implementation.
Incentives
Incentives are benefits or rewards provided to encourage specific behavior or actions, such as starting
a business, investing in a particular sector, or adopting new technology.
• Tax Exemptions for Startups: Includes a 3-year tax holiday for eligible startups under the Startup
India initiative.

• Capital Gains Tax Exemption: Exemptions on capital gains if the gains are reinvested in startups or
specified funds.

• Angel Tax Exemption: Exemption on Angel Tax for recognized startups.

• Research and Development Incentives: Tax deductions on R&D expenses for companies focusing
on innovation.

• Priority Sector Lending: Banks are mandated to allocate a portion of their lending to the MSME
sector, making credit more accessible to entrepreneurs.
Subsidies
Subsidies are financial contributions provided by the government to reduce the cost of goods or services,
making them more affordable for businesses or consumers.

• Credit Guarantee Fund : Offers collateral-free loans to micro and small enterprises, with a guarantee
cover to banks.

• Interest Subsidies: Interest rate subsidies provided on loans to reduce the cost of borrowing for
entrepreneurs.

• Capital Subsidies: Direct financial assistance provided for the purchase of capital goods, machinery,
and equipment.

• Technology Upgradation Subsidy: Support for MSMEs to upgrade technology, improve productivity,
and enhance competitiveness.
Grants
Grants are non-repayable funds provided by the government or organizations to support specific projects,
activities, or business initiatives.

• Startup India Seed Fund Scheme (SISFS): Grants provided to startups for proof of concept, prototype
development, and commercialization.

• Innovation and Incubation Grants: Funds allocated to startups incubated in recognized incubation
centers for developing their ideas.

• Marketing and Export Promotion Grants: Financial assistance for startups to participate in trade fairs,
exhibitions, and promotional activities.

• Skill Development Grants: Funding for training and skill development programs aimed at empowering
entrepreneurs and their workforce.
EOU
• The Export Oriented Units (EOU) scheme aims to promote exports and increase foreign exchange
of the country by creating additional production capacity.
• Only those units that are undertaking to export their entire production of goods are allowed to be
set up as an Export Oriented Unit.
Benfits:
• Exports lead to an inflow of foreign exchange, which helps the nation to improve its economic
position.
• Aims to generate additional employment through the export sector.
• EOUs were also expected to improve the supply chain starting with the procurement of raw
materials to the supply of finished products to the DTA.
• Export also means an eventual upgrade in the quality and service
• EOU scheme was also expected to inspire technological advancements and skill development in
the nation
 Fiscal & Tax concessions available
• 3 year tax holiday in a block of seven years
• Exemption from tax on Long-term capital gains
• Tax exemption on investments above the fair market value
• Tax exemption to Individual/HUF on investment of long-term capital gain in equity shares of Eligible Startups

An EOU enjoys the below benefits:

•  An EOU can purchase raw material or capital goods duty-free either through imports or domestic sources.
•  It is also eligible for domestic reimbursement of GST on raw materials or capital goods.
•  It can claim reimbursement of duty paid on fuels obtained from domestic oil companies.
•  It is eligible to claim Input Tax Credit (ITC) on goods and services used to manufacture goods used for export.
•  It can avail exemption from industrial licensing for items reserved for Small Scale Industries.
Start-Up India initiative
• The Start-Up India initiative was launched by the Government of India on January 16, 2016,
• It helps in building a strong ecosystem that fosters innovation and entrepreneurship, thereby
driving sustainable economic growth and generating large-scale employment opportunities.
• The program is designed to empower startups to grow through innovation and design, providing
them with numerous benefits and support.
Key objectives & Impact of Start up India
Objectives:
1. Simplification and Handholding
2. Funding Support and Incentives
3. Industry-Academia Partnership and Incubation

Impact:
Start-Up India has recognized over 100,000 startups across various sectors.
The initiative has also led to the creation of job opportunities.
It has significantly boosted the entrepreneurial spirit in India, leading to a surge in new startups,
especially in technology, e-commerce, healthcare and so on...
Latest Industrial Policy of GOI
1. Startup India Initiative - simplifying regulation, funding, mentoring and ranking platform

2. Startup India Seed Fund Scheme (SISFS) - rescue, providing financial assistance of up to ₹10
crore through accredited incubators registered with start up India

3. Credit Guarantee Scheme for Startups (CGSS) -This scheme guarantees loans up to ₹5 crore from
participating banks, alleviating financial constraints.

4. Atal Innovation Mission (AIM) -AIM empowers innovation with grants of up to ₹10 crore in any
sector

5. Software Technology Parks of India (STPI) IT units, "STPI NEXT" focuses on emerging
technologies like AI, AR/VR, and IoT.
contd...
6. Pradhan Mantri Mudra Yojana (PMMY) -empowers them with collateral-free loans ranging from ₹50,000 to
₹10 lakh for all MSME
No collateral required, flexible repayment options, and interest rate subsidies.

7. Ebiz Portal - One-stop solution. This single-window platform streamlines the process and mobile app for the
on-the-go access

8. Dairy Processing and Infrastructure Development Fund (DIDF) - DIDF provides financial assistance for
setting up or expanding processing units. Grants

9. Startup Intellectual Property Protection Scheme (SIPPS) - This scheme safeguards the ideas, empowering to
confidently build your brand.

10. Market Access Promotion Scheme (MAPS) - Financial assistance for participation in international trade fairs
and exhibitions, opening doors to new markets and opportunities.
EOU registered with DGFT.
Latest Industrial Policy of GOI
1. Startup India Initiative
This flagship program serves as the foundation, simplifying regulations with
self-certification and compliance relaxations
Beyond self-certification and compliance relaxations, the Initiative offers:
• Funding opportunities: Startup India Hub connects you to relevant investors and
networks.
• Mentorship programs: Connect with experienced industry veterans for guidance.
• Startup Ranking Platform: Gain visibility and attract potential investors.
2. Startup India Seed Fund Scheme (SISFS)
• SISFS comes to the rescue, providing financial assistance of up to ₹10 crore through accredited
incubators, highlighting its effectiveness in nurturing young ideas.
• Focus: Early-stage ventures in mobile apps, healthcare & diagnostics, cleantech, education, and
more.
• Eligibility: Startups incorporated as private limited companies with a minimum viable product
(MVP).
• Application: Through accredited incubators registered with Startup India.
3. Credit Guarantee Scheme for Startups (CGSS)
• Accessing credit, often a major roadblock becomes smoother with CGSS. This scheme guarantees
loans up to ₹5 crore from participating banks, alleviating financial constraints. Over 7,300 startups
have benefitted, with sanctioned loans exceeding a staggering ₹29,500 crore, demonstrating its
reach and impact.
• Loan types: Term loans, working capital loans, and purchase order financing.
• Benefits: Up to 80% guarantee on loans, reduced interest rates, longer repayment tenure.
• Eligibility: Startups incorporated as private limited companies with a turnover of up to ₹50 crore in
the previous year.
4. Atal Innovation Mission (AIM)
• Innovation revolutionizing healthcare, education, or agriculture- AIM empowers with grants of up
to ₹10 crore. Its impact is evident in the establishment of 75,794 Tinkering Labs and 708 Atal
Incubation Centers across India, fostering a culture of creativity and problem-solving.
• Programs: Atal Tinkering Labs (ATL) in schools promote scientific temper and innovation, while
Atal Incubation Centers (AIC) nurture startups across various sectors.
• Support: Grants for prototype development, market research, and capacity building.
• Eligibility: Educational institutions, incubators, and research institutions can apply for establishing
ATLs or AICs.
5. Software Technology Parks of India (STPI)
• Operating in the IT domain? STPI is your ally. It offers tax benefits, infrastructure support, and
incubation facilities, nurturing the growth of over 85,000 STPI units. These units have collectively
generated exports worth over ₹5.5 lakh crore, showcasing the scheme's contribution to the tech
sector.
• Benefits: Tax exemptions on profits and import duties, infrastructure support in designated STPI
centers.
• Eligibility: IT/ITES companies with export intent.
• Special Initiatives: "STPI NEXT" focuses on emerging technologies like AI, AR/VR, and IoT.
6. Pradhan Mantri Mudra Yojana (PMMY)
• Recognizing the pivotal role of MSMEs, PMMY empowers them with collateral-free loans ranging
from ₹50,000 to ₹10 lakh. Since its launch, it has transformed the lives of over 30 crore
entrepreneurs, acting as a springboard for countless success stories.
• Loan schemes: Three categories - Shishu (up to ₹50,000), Kishor (₹50,000-₹5 lakh), and Tarun (₹5
lakh-₹10 lakh).
• Eligibility: Micro and small enterprises across various sectors.
• Benefits: No collateral required, flexible repayment options, and interest rate subsidies.
7. Ebiz Portal
• Battling registrations and approvals? Ebiz is your one-stop solution. This single-window platform
streamlines the process, saving valuable time and effort for entrepreneurs. With over 1.3 crore
registrations processed, it's a testament to its efficiency in simplifying business operations.
• Services: Company registration, GST compliance, licenses, approvals, and clearances.
• Benefits: Faster processing times, a single window for all needs, and online tracking of
applications.
• Additional resources: Ebiz Mobile App for on-the-go access.
8. Dairy Processing and Infrastructure Development Fund (DIDF)
• Are you passionate about revolutionizing the dairy sector? DIDF provides financial assistance for
setting up or expanding processing units. With an outlay of ₹10,861 crore, it aims to empower over
5 lakh milk producers, fostering inclusive growth in the sector.
• Support: Grant-in-aid for modernization of existing units, establishment of new processing units,
and capacity building.
• Eligibility: Dairy cooperatives, farmer-producer organizations, and private companies.
• Benefits: Financial assistance for infrastructure development, processing equipment, and cold
chain facilities.
9. Startup Intellectual Property Protection Scheme (SIPPS)
• Protecting your intellectual property (IP) is crucial for sustainable growth. SIPPS reimburses
startups 50% of the filing fees for patents, trademarks, and copyrights, up to a maximum of ₹5
lakh. This scheme safeguards your ideas, empowering you to confidently build your brand.
• Reimbursement: 50% of filing fees for patents, trademarks, and copyrights, up to a maximum of ₹5
lakh.
• Eligibility: Registered startups fulfilling specific criteria.
• Benefits: Encourages innovation and protects intellectual property rights.
10. Market Access Promotion Scheme (MAPS)
• It provides financial assistance for participation in international trade fairs and exhibitions, opening
doors to new markets and opportunities. Over 8,000 companies have benefitted, generating exports
of over ₹28,000 crore, showcasing its effectiveness in propelling global ambitions.
• Support: Financial assistance for participation in international trade fairs, exhibitions, and
buyer-seller meets.
• Eligibility: Export-oriented companies registered with DGFT.
• Benefits: Connect businesses with potential international buyers, and increase export opportunities.
Financial Institutions in India supporting
Entreprenuership
A brief overview of financial institutions in India -

• IDBI - Industrial Development Bank of India

• SIDBI - Small Industries Development Bank of India
• NABARD - National Bank for Agriculture and Rural Development

• IIE - Indian Institute of Entrepreneurship

• SIDCO - Small Industries Development Corporations

• DIC - District Industries centre
• SWS - Single window scheme