U.P. catching up in start-up race, doing business has become easier: Entrepreneurs
In February, the U.P. government, during the Budget session, told the House that there are up to 50 incubators and 7,200 registered startups operating in the state.
LUCKNOW Gone are the days when becoming doctors, engineers, lawyers, and others were the only cream career options for the youth of the state. Credit to the thriving start-up culture in Uttar Pradesh and in the country at large, the entrepreneurial dreams of the young generation have found new wings. Such has been the rise of the trend that India currently ranks third in the world in the number of start-ups.
Recently, the Centre released a report revealing that U.P. stands third in the country in terms of MSME registrations on the Udyam Portal. The state has 12.6 lakh registered MSMEs on the portal only behind Maharashtra (27.6 lakh) and Tamil Nadu (15.43 lakh). The MSMEs have been defined as companies with an annual turnover of less than ₹250 crore, according to the Centre.
In February, the U.P. government, during the Budget session, told the House that there are up to 50 incubators and 7,200 registered startups operating in the state. In the state, Noida has turned out to be the most preferred destination for startups followed by Ghaziabad, Agra, Lucknow, and Gorakhpur in the Purvanchal region.
Speaking about the change in the business scenario in U.P. in the last few years, Anmol Bansal, co-founder of Kanpur-based start-up ‘NovoEarth’ and a former incubate at IIT-Kanpur, said, “In the last six years of chief minister Yogi Adityanath, the state has implemented a number of policies that have created a welcoming environment for young entrepreneurs. As a highly technical startup, which required significant cash burn for product development, the government was instrumental in providing us grants. Today, I see so much excitement among government officials when they see new technologies. They offer all available resources -- from connections to funds -- to entrepreneurs.”
He added, “It has become much easier in recent years for young entrepreneurs in India to start their businesses because of the government’s Startup India initiative, which was launched in 2016. Entrepreneurs now have access to a variety of benefits and incentives, such as tax deductions, funding, and streamlined regulatory processes.” Anmol’s startup uses poultry waste and multi-layered packaging, and converts them into bio-polymers which are used for multi-making utensils and building materials.
Similarly, Harshit Verma, another entrepreneur from Lucknow who recently opened his cafe -- ‘Two States’ -- feels that apart from ease of doing business, registration and the process of getting a licence has also become easier in the state. “Everything has become online from registering businesses to getting a food licence. I applied for a food licence and received it within a week,” said Verma, who co-owns the chain with his wife Puja Sinha. “I used to be a banker but after witnessing the opportunities in business, I switched. Also, in the finance domain, I am aware of how much easier it has become to obtain credit in a short period of time,” he added.
Echoing the sentiment, Ankit Agarwal, Founder & CEO of a Phool.com, Kanpur, said, “This government has given a big push to the startups in the state. Many exhibitions and business meetings are being organised where startups are invited to seek investments. Global Investors’ Summit (GIS) was one such event where our stall was put up.”
Opening businesses have become easier for women too, says Riya Tiwari, an entrepreneur from Prayagraj. “State’s provision of providing 50% incentive to women entrepreneurs is a great decision which will motivate women to come forward,” said Tiwari who is a co-founder of AV Automobiles, a start-up incubated at AKTU, Lucknow. Tiwari’s startup recently developed an electronic supercar which was showcased at GIS 2023.
Recent Initiatives
The state’s IT and electronics department notified the U.P. Startup Policy of 2020 to expand the bouquet of incentives and financial sops to enrich the ‘business climate’.
Under the new framework, the start-up seed capital/marketing support sum was hiked by 50% from ₹5 lakh to ₹7.5 lakh.
Besides, the sustenance allowance to start-ups was increased from ₹15,000 to ₹17,500 per month for a year. In addition, eligible start-ups were promised prototype development funding of ₹5 lakh.
Additional incentives of 50% to startups based in Purvanchal and Bundelkhand regions as well as to those where startup founders/co-founder is a woman, “divyangjan” or from a transgender community.
Last year, the targeted number of start-up centers of excellence (CoE) in U.P. increased from three to eight.
Earlier this year, the government, in its annual Budget statement, announced ₹100 crore for seed funds to promote incubators. ₹60 crore proposed for the UP IT and Startups Policy in the Budget. ₹20 crore in the Agriculture Accelerator Fund to encourage young entrepreneurs to set up agritech start-ups in rural areas.