Startup20 Engagement Group

Context

• Startup20 is a new engagement group initiated under India’s G20 presidency.

About the Startup20 Engagement Group

• About:
  • The Startup 20 Engagement Group is a new addition to the G20 engagement groups proposed under India’s presidency. 
    • The group is India’s innovation to the G20 movement, it’s the first engagement group which drives technology, innovation, and the start of the movement. 
  • Aim:
    • The group aims to create a global narrative for supporting startups and enabling synergies between startups, corporates, investors, innovation agencies and other key ecosystem stakeholders. 
• Objective & purpose:
  • The primary objective is to harmonize the global startup ecosystem through a collaborative and forward-looking approach.
  • The purpose of this group is: 
    • To provide a common platform for startups from G20 member countries to come together to develop actionable guidance in the form of building of enabler’s capacities, 
    • Identification of funding gaps, 
    • Enhancement of employment opportunities, 
    • Achievement of SDG targets & climate resilience, and 
    • Growth of an inclusive ecosystem.
• The engagement group comprises of three taskforces, namely 
  • Foundation & Alliance, 
  • Finance, and 
  • Inclusion & Sustainability, 
  • Under the taskforce delegates will come together to discuss efficient policy frameworks to promote scaling up of startups in the G20 nations.
• Functioning along the B20 Engagement Group:
  • In the new architecture, while the existing B20 Engagement Group continues its focus on corporations, the Startup20 takes on the policy issues concerning the global startup ecosystem, with the necessary linkages between the two groups.

Significance

• The group is borne out of India’s conviction that the world needs more and more of technology, the world needs more disruption, and the world needs young entrepreneurs to drive the world out of the present recessionary trend.
• This will enable the nation to collaborate with other countries in scaling Indian innovations, promote the Indian startups’ sector, and usher in infrastructure development.

Start-up ecosystem in India

• About:
  • India has the 3rd largest startup ecosystem in the world; expected to witness YoY growth of consistent annual growth of 12-15%.
  • The pace of growth in the startup ecosystem has increased to 15% year-on-year in 2018, while the growth of the number of incubators and accelerators has grown to 11%
    • The Indian startups have gone on to raise sizable ticket sizes from various global and domestic funds. 
• Government’s initiatives to promote Start-ups in India:
  • Startup India Initiative: 
    • Since the launch of the initiative in January 2016, more than 69,000 startups have been recognized in the country till May2022.
    • Sectors: 
      • They were launched across 56 diverse sectors, including:
        • 13% from IT services, 
        • 9% from health and life sciences, 
        • 7% from education, 
        • 5% from professional and commercial services, 
        • 5% from agriculture, and 
        • 5% food and beverage. 
    • Functions: 
      • Enhanced infrastructure including incubation centers.
      • Easier IPR facilitation, including easier patent filing
      • A better regulatory environment including tax benefits, easier compliance, improved of setting up a company, faster exit mechanisms and more
      • An economic stimulus in the form of a INR 10,000 crore Fund of Funds managed by SIDBI, with the goal of increasing funding opportunities. 
    • Government Data: 
      • As per data from the Ministry of Commerce and Industry, the number of people employed in start-ups covered under the Start-up India initiative stood at about 1.74 lakh in 2021.
  • Start-Up India Programme: 
    • A flagship initiative, intended to build a strong ecosystem for nurturing innovation and start-ups in the country to drive sustainable economic growth and generate large-scale employment opportunities.
  • Start-up India Digital Platform: 
    • It is the world’s largest virtual incubator with over 300,000 registered start-ups and aspiring entrepreneurs.
  • Start-up Grand Challenge: 
    • It channelises the entrepreneurial capacity between Indian and Korean start-ups to work together and build solutions for the challenges facing the world.

Way ahead

• The Group of Twenty has turned itself into an ambidextrous institution, one where both large corporations and startups have an equal voice in taking the economies forward. 
• This could be a new step towards international economic and policy cooperation on specific interests of the startup sector.
• As the G20 president, India must deepen its alliances with the IMF, OECD, WHO, World Bank, and WTO, and push for tougher controls on terror-related finances.