The government has allocated Rs 830 crore for the Fund of Funds for Startups in the Budget 2021-22, which is higher than the revised estimate of about Rs 430 crore.
The government has set up a Fund of Funds for Startups (FFS) with a corpus of Rs 10,000 crore. The Small Industries Development Bank of India (SIDBI) is the operating agency for the FFS.
The allocation for the fund of funds in Budget 2020-21 was Rs 1,054.97 core, but it was revised to Rs 429.99 crore.
According to the Budget documents, the allocation for Startup India programme has been increased marginally to Rs 20.83 crore for 2021-22 from the revised estimate of Rs 20 crore in 2020-21.
Startup India initiative aims at fostering entrepreneurship and promoting innovation by creating an ecosystem that is conducive to the growth of budding entrepreneurs.
On the other hand, the government has earmarked Rs 300 crore for credit guarantee fund.
The cumulative allocation for the Department for Promotion of Industry and Internal Trade (DPIIT) has been hiked to Rs 7,782.24 crore for 2021-22 as against the revised estimate of Rs 7,583.06 crore in 2020-21.
Similarly, the cumulative allocation for the Department of Commerce has also been increased to Rs 4,986 crore for 2021-22 as against the revised estimate of Rs 4,600 crore in 2020-21.
The total allocations for export promotion schemes, such as Market Access Initiative and Interest Equalisation Scheme, has been increased to Rs 2,365 crore for 2021-22 as against the revised estimate of Rs 2,175 crore in 2020-21.
On Monday, in a welcome move for Indian startups and MSMEs, Finance Minister Nirmala Sitharaman proposed the incorporation of one-person companies, with no restriction in paid-up capital and turnover, as well as an update to the definition of small companies under Companies Act, 2013.
(Disclaimer: Additional background information has been added to this PTI copy for context)