Budget 2015: Rs 1000 crore announced to enable IT start-ups

Technology startups are giving a thumbs up to FM's announcement of Rs. 1000 crore fund for supporting the startup environment. The FM in his speech hailed the IT-BPM industry of India as "World Class" and one of the largest employers in the country. He also expressed the need to recognize and support cutting edge technology startups, announcing a Rs. 1000 crore fund for the purpose.

"We are now seeing a growing interest in startups. Experimenting in cutting edge technologies, creating value out of ideas, initiatives and creating them into scalable enterprises and businesses is at the core of our strategies," he said while presenting the Budget for 2015-16 in the Lok Sabha.

The minister added that the IT-ITeS sector has raked in revenues of $119 billion in 2014-15 and directly employs about 40 lakh people.

He further said, "With this objective, the government is creating a mechanism known as Self Employment and Talent Utilisation (SETU) to be techno-financial incubation and facilitation programme to support all aspects of start up business and other self employment activities particularly in the technology driven areas.

"I am setting aside Rs 1,000 crore initially for this purpose."

According to the Economic Survey 2014-15, India has emerged as the world's fourth largest hub for start-ups with over 3,100 of them, driven by "hyper growth" in technology and software products in the country.

While the analysts are a bit skeptical, the startup guys are hopeful of this announcement having a positive impact on the startup scene. Says Ajay Ahuja, an app developer and an aspiring entrepreneur- "Its good news and can help young techies with no financial backing."

According to Sanchit Vir Gogia, Chief Analyst and CEO, Greyhound Research, the government first needs to give clarity on Rs.10,000 crore for startups from last year's budget and then let's talk fresh."