India's Finance Minister Nirmala Sitharaman presented the fourth Union Budget on Tuesday for the financial year 2022-2023. The main focus being Aatmanirbharta, fresh announcements were made for the startup ecosystem.
Nirmala Seetharaman, in her speech mentioned that Startups in India have emerged as growth drivers, it is noticeable that the Indian Startups have given employment to nearly 6 lakh people. More than 60,000 startups have been set up in India since 2016. Recently, Delhi became the startup capital of India, leaving behind Bengaluru according to the Economic Survey 2022.
StartupEd has gathered the key takeaways from the Budget 2022 for the Indian Startup Ecosystem and simplified them for you.
All startups that were functioning before 31st march 2022 (since April 1, 2016) will be eligible for a tax rebate of 100 percent. To incentivize startups, Finance Minister Nirmala Sitharaman proposed the extension of the period for the eligible start-ups by one year, which will be up to March 31st, 2023. Experts say that there was an upsurge in successful startups in the last year and an extension of a year will be beneficial for the ecosystem and will give it a boost to the funding.
Focus on Cryptocurrency
Another great reform that was put forward by the finance minister and that will bring clarity to the crypto investors all over India is that the cryptocurrency as an asset is now legitimized. It is noticeable that the government has inflicted a fixed tax of 30% on all the income that will be generated through crypto trading. It was even announced that the RBI will soon begin to issue its digital rupee currency using blockchain technology in this year itself. This also allows the Web3 companies to keep their headquarters in India rather than shifting to countries that permit crypto applications.
DrAAS (Drones as a service)
For the agricultural and rural sectors, the minister mentioned that they will be served with funds mobilized through NABARD. Seetharaman said that the startups will support FPOs and will provide tech to farmers. It was announced that Drones will be used to digitize land records and other processes, spraying of insecticides as well as nutrients will be done through “Kisan drones”. Through this initiative, Drones will be used as DrAAS (Drones As A Service) that will not only drive the growth of the drone industry but other sectors as well.
It is noticeable that India has already surpassed the UK and is now the third-largest country in terms of unicorns. India has generated 44 unicorns in the year 2021, even when the pandemic was at its peak!
The Union Budget 2022 opens a lot of opportunities for startups across agriculture, defense, fintech, drone, and other fields. This is a Digital Indian Budget as the government is promising to lead the country forward on a digital path that will also bring the startup ecosystem forward.