Indian government intends to extend support to various Indian startups, and therefore, it can lend ‘Aadhaar’ card facility to the companies. It is a word of Hindi origin that connotes support or foundation, and thus it means that extending support to the startup companies. In a way, it means, given a unique identification number to Indian enterprises. Government can extend its support to investors in the startup industry. However, it proves how ID programme facility can be provided to help startups grow more.
For any startup ecosystem to expand, government plays a pivotal role that helps the organizations to carry out activities for its overall growth. For the proper growth and expansion of the startups, some potential policies can be implemented pertaining to taxation and regulation. In addition to the organization, it also helps the stakeholders, lawyers, consultants, fund providers and many others. So, some vital steps that government might undertake to let the startups grow are:
Government can start with tax implementation and create certain tax rules that help to control and regulate the cash flow from events pertaining to the startups. It helps to make the tax structure favorable for the startups in its initial stages. In addition, the structure further helps them to reinvest every fund they earn in due course of the operations. It shall also help them to manage the business during the crisis period. Besides, they should know how to maintain uniformity between private and public markets which became vital after the introduction of long-term capital gains. It helps build strong business relationship among the stakeholders and avoid uncertainties during any future planning.
The government plays an important public relations role for the startup organizations and educating the stakeholders that shall help them to take part in the growth of the overall ecosystem. In addition, it also helps them to remove misunderstandings among the people of the startup.
Besides, the government also helps in creating startups in the campuses of educational institutions including engineering and management institutes. In a way, it encourages students to take up the role of entrepreneurship as a suitable career option. This can be a way of boosting the overall ecosystem of startups and promoting the partnership. In the name of expanding startups, government can also try to create sources of investment and help the enterprises expand more. One example of sovereign investment is funds of funds for startups or FFS given by Small Industries Development Bank of India or SIDBI. Narendra Modi has approved it in the year 2016 around June.
The use of Aadhaar came into being for the welfare of the citizen of India. Following this, the government has taken up the initiative to link Aadhaar card number with every possible thing like bank accounts, mobile numbers and every other compulsory information required for undergoing any purchase like rail tickets, etc. Apart from this scenario, the government is also taking the initiative to extend the involvement of Aadhaar cards in the decision making part of the startups.
For instance, in a startup business, to facilitate loan operation between one party residing in Mumbai and the other one residing in any remote village in India, the Aadhaar card helps in various ways.
Apart from all these, another help that needs to be extended to the startup industries includes providing a network from which the enterprise can get benefits, get rid of the existing friction in the business relationships, set proper timeline for sanctions and ensuring that everything works according to the law set by the startup. If the organizations are able to abide by such regulations, it encourages them to grow more and create a system that the stakeholders find convincing enough to invest.
An out-of-the-track question might arise that whether tax incentive system needs to be created for the large enterprises that happen to hire the failed entrepreneurs. Scenarios might come up when startups flourish in the beginning but fail to maintain its growth level. There are certain reasons behind this, and some of them are the emergence of the competitors in the market, change in taxation and other regulations, inability to grab the attention of the investor or unable to retain the same, etc.
Among the young graduates, the government can help the ones who have failed to run their startups and instead of considering them as failed, they can start to help the entrepreneurs think about regular corporate life. The youngsters should be encouraged in changing their track into the corporate world instead of brooding with the failure.
For the overall economic growth, the Indian government has encouraged people to know about the importance of startup ecosystem. In addition, it also helps create employment and inspires entrepreneurial mindset among the youngsters. There is also technological advancement in the overall growth of the Indian startup ecosystem. Therefore, the government should take care of the overall startup ecosystem and continue extending its support for the growth of the environmental condition at its best.