The Karnataka government is planning to introduce new sector-based booster kits for startups in the State in a month’s time.
IT/BT Minister Priyank Kharge told The Hindu that that the new kit would be much more practical than the earlier ones with its sector-based approach.
What each sector needs
“We are evaluating what it is that a particular sector needs. For example, in the biotech space, startups are not the problem, scaling is; Idea to proof of concept is not a challenge, but from there to Stage-1 is. After that funding gets easy. If it is a robotics startup, they can be tied up with ARTPARK. If it’s a life sciences startup, they could be given an opportunity to work in medical science colleges or other similar institutes. We are talking to people in various sectors and trying to figure out how to help,” Mr. Kharge said.
The startup Karnataka booster kit was launched initially in 2016. The kit currently includes a range of software tools, cloud credits, access to mentors, incubators and government funding, and legal and financial consultants, and is available for any startup registered with the government of Karnataka.
“The last booster kit that was made was during my previous tenure. The successive governments did not bother about that. Now, I’m talking to startups, engage with them very often and trying to understand what they want specifically,” the Minister said.
Working with VCs
Mr. Kharge also noted that in the context of the ongoing funding winter, the government, for the first time, has been working with the Venture Capitalists to come up with a blueprint to understand how the former could help startups add more value.
The government is also coming up with a framework which would allow fewer number of startups to fail, he said.
“One part of it is the ELEVATE programme. Not all startups need money to succeed. Some can succeed with mentorship, some with market access, some by getting their first client. The government wants to facilitate all these. We have introduced the preferential market access for startups where government can be the first customer for startups,” Mr. Kharge noted, adding that he is also engaging with banks to understand where government intervention is required.
The ELEVATE call, which recently closed, got close to 900 applications in less than a month. ELEVATE Unnati for startups with founders from SC/ST communities has received 83 applications, said Mr. Kharge.
He noted that the State is also keen to work with startups to solve problems related to urban infrastructure and mobility and an urban solutions summit is being planned by Deputy Chief Minister D.K. Shivakumar.
Angel tax still high in India
The Minister came down heavily on the central government for the high angel tax and questioned if the Centre is serious about Startup India.
“Investing in innovation comes at a high cost in India. It falls under the Central Government. If they are serious about Digital India, Startup India and so on, they should ease things out. How did Karnataka become the fourth largest technology cluster in the world? We took the hit for the greater good. Central government does not want to do that. Why is innovation being taxed so heavily in India? Indian startups, while scaling, move to USA and Singapore because of tax policies here,” he criticised.
