India Sees the Emergence of the 100th Unicorn

The wave of Unicorns in India has soared to new heights as the country witnessed the birth of its 100th Unicorn on 2nd May 2022. Today, 1 out of every 10 unicorns globally have been born in India

Utility: UPSC, JPSC, BPSC Prelims & Mains
Section: Economy / Sectors

Key Points

  • The Indian Startup Ecosystem is the third-largest in the world in the number of Unicorns.
  • As of May 2022, India is home to 100 unicorns with a total valuation of USD 332.7 billion.
  • 2021 experienced a huge surge in the number of unicorns, registering a total of 44 startups entering the Unicorn club through the year with a total valuation of USD 93 billion. 
  • In the first four months of 2022, India has given birth to 14 unicorns with a total valuation of USD 18.9 billion.
  • Since the launch of the Startup India initiative on 16th January 2016, more than 69,000 startups have been recognized in the country.
  • Innovation in India is not just limited to certain sectors; we have recognized startups solving problems in 56 diverse sectors.
  • These sectors include- 13% from IT services, 9% from healthcare and life sciences, 7% from education, 5% from professional and commercial services, 5% from agriculture, and 5% from food & beverages.
  • Till FY 2016-17, approximately one unicorn was being added every year.
  • Over the past four years (since FY 2017-18), there is a whopping 66% Year-on-Year growth in the number of additional unicorns being added every year.
  • The Department for Promotion of Industry and Internal Trade (DPIIT) has recognized startups across 647 Indian districts encompassing all 36 States and Union Territories.

About Startup India

  • It is a flagship initiative of the Government of India.
  • Aimed to build a strong ecosystem for nurturing innovation and Startups in the country.
  • So as to drive sustainable economic growth and generate large-scale employment opportunities.
  • The Government through this initiative aims to empower Startups to grow through innovation and design.
  • In order to meet the objectives of the initiative, the Government of India announced Startup India Action Plan.
  • The Government’s Action Plan will help accelerate the growth of Startups throughout India, across all important sectors – in Tier 1, 2, and 3 cities.
  • Also includes semi-urban and rural areas – and includes promoting entrepreneurship among SCs/STs and women communities.
  • The 19-point Action Plan, organized by the Department for Promotion of Industry and Internal Trade  (DPIIT), focuses both on restricting hindrances and promoting faster growth.
  • The Startup India Action Plan was unveiled by Prime Minister on 16th January 2016.
  • In order to provide funding support to Startups, Government set up a fund with an initial corpus of INR 2,500 crore and a total corpus of INR 10,000 crore over a period of 4 years.
  • The Fund will be in the nature of the Fund of Funds.
  • The credit guarantee mechanism through the National Credit Guarantee Trust Company (NCGTC)/ SIDBI has also been envisaged.
  • Other benefits:
    • Tax Exemption on Capital Gains
    • Tax Exemption to Startups for 3 years
    • Tax Exemption on Investments above Fair Market Value
  • Under the Startup India initiative, eligible companies can get recognised as Startups by DPIIT, in order to access a host of tax benefits, easier compliance, IPR fast-tracking & more.

What is a Startup?

  • A Startup (for the purpose of Government Schemes only) means an entity:
  • incorporated or registered in India not prior to five years,
  • with an annual turnover not exceeding INR 25 crore in any preceding financial year,
  • working towards innovation, development, deployment, or commercialization of new products, processes, or services driven by technology or intellectual property.
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