Budget 2015: Fund of Rs. 1,000 cr for startups, entrepreneurs

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SME Times News Bureau | 28 Feb, 2015
Aiming to support start-up businesses and other self-employment activities, the government proposes to establish a Self Employment and Talent Utilisation (SETU) mechanism for which it will set aside Rs.1,000 crore initially in the NITI Aayog.

"The government is establishing a mechanism to be known as SETU. SETU will be a techno-financial, Incubation and Facilitation Programme to support all aspects of start-up businesses and other self-employment activities, particularly in technology-driven areas. I am setting aside Rs.1,000 crore initially in NITI Aayog for this purpose,” Finance Minister Arun Jaitley said while presenting the Union Budget 2015-16 in the Lok Sabha.

He said India has a well regarded and world-class IT industry with revenues of about $150 billion, over $100 billion of exports, and employing nearly 40 lakh people directly.

"We are now seeing a growing interest in start-ups. Experimenting in cutting edge technologies, creating value out of ideas and initiatives and converting them into scalable enterprises and businesses is at the core of our strategy for engaging our youth and for inclusive and sustainable growth of the country," Jaitley added.

"Concerns such as a more liberal system of raising global capital, incubation facilities in our Centres of Excellence, funding for seed capital and growth, and ease of doing business etc. need to be addressed to create lakhs of jobs and hundreds of billion dollars in value," he said.

The minister said there was a need to encourage and grow the spirit of entrepreneurship in India and support new start-ups. "Only thus can our youth turn from being job-seekers to job-creators."

The minister announced the launch of a National Skill Mission to develop youth employability, especially for those below 25 years of age.

"National Skill Mission to be launched, to develop employability of youth, especially below 25 years of age," he added.

He also announced Nayi Manzil, a scheme to enable minority youth without school leaving certificates, to get employment.

In line with the expectation of major reform measures by the government, Finance Minister announced that two more "game changing reforms" are coming up.

"Two more game changing reforms are on the anvil in the form of a state-of-the art indirect tax system the GST (Goods and Services Tax) and the JAM to implement the direct benefit transfer scheme," Jaitley told the Lok Sabha.

The JAM number trinity, as described by the Economic Survey 2014-2015 released on Friday, consist of the financial inclusion scheme Jan Dhan Yojana and the Aadhaar and mobile numbers, all of which allow the government to offer support to poor households.

The finance minister in his budget speech also proposed changes in the direct tax system to make it complementary with the far-reaching changes to be brought in by the GST.

By subsuming a large number of central and state taxes into a single tax, the GST would mitigate cascading or double taxation in a major way and pave the way for a common national market.

"We're moving in various directions to implement GST from next year," Jaitley told parliament.

The Federation of Indian Chambers of Commerce and Industry has said that after the Reserve Bank cut interest rates in January, implementation of the GST would take care of the other major demand of Indian industry.