Entrepreneurs from across Tamil Nadu have urged the State government to evolve a start-up policy of its own soon. For its part, the Tamil Nadu government has been talking about formulating a start-up policy to encourage entrepreneurship with a special focus on tier-2 towns and rural pockets. In the last three years, officials have discussed this in several forums and said, “the policy is ready” but it has not been unveiled yet.
“Hiring in the IT sector looks bleak and more entrepreneurs are emerging from various pockets of Tamil Nadu. It’s time the government of Tamil Nadu comes out with a policy and guidelines that cater to start-ups,” said one of the entrepreneurs participating in TiECON 2017.
According to a presentation made at TiECON Chennai 2017 on ‘India Venture Capital and Private Equity Report 2017’ by Thillai Rajan of the Department of Management Studies, IIT-Madras, various State governments have begun to focus on having a start-up policy over the last two years. Out of the 29 States in India, 22 formally came out with start-up policies in the last three years.
Cumulatively, the State governments’ policies envisage creation of incubation space of 5.1 million square feet, 48,000 start-ups, and investment of close to ₹34,000 crore of venture funding by 2022.
In his report that focuses on “The State and the Start-Up: Analysis of government policies and support for start-ups”, Prof. Rajan points out that start-ups and entrepreneurship has caught the imagination as well as the attention of policy-makers today. “As the ‘Start-up India, Stand-up India’ campaign gains momentum, ministries of the national government, various State governments, and several organisations of the government have begun to take serious steps to create a favourable ecosystem for the development of start-ups,” he said.
Support from PSUs
Prof. Rajan told The Hindu that there was a significant rise in start-up programs by Public Sector Undertakings (PSU) and the Council of Scientific and Industrial Research (CSIR) Labs. Since 2016, at least 10 PSUs have launched their start-up support programs.
The aggregate initial outlay of all the PSUs for start-up funding is around ₹400 crore. CSIR expects to support, by the end of 2017, around 100 incubatees in five of its laboratories. The PSUs and CSIR labs are supporting start-ups in those sectors that are either capital-intensive or very niche, and therefore not too many ventures have come up.
Data mined by Prof. Rajan shows that at least 30 Public Sector Financial Institutions (PSFIs) have contributed to the corpus of Venture Capital funds.
The current value of investments by PSFIs in various venture funds has been in excess of ₹7,000 crore.
