When Prime Minister Modi announced “Startup India, Standup India” on Independence Day, 15 August 2015, from the ramparts of Delhi’s Red Fort, I found myself humming the Bob Marley anthem, “Get up, Stand up”.
That Reggae chart buster, also the last signature last song performed live on stage by Marley before his death in 1981, became the battle cry for human rights, and civil rights movements across the world since its launch in 1973.
I expect this to be the anthem of “Startup India, Stand up India”. Let’s look at the backdrop for a moment. India, after 25 years of economic liberalization, has seen rapid progress. However, the role of government spending at the bottom of the pyramid has had little impact in changing the fortunes of the bottom half. On the other hand, rapid progress in the IT/ ITeS sectors, combined with services outsourcing and policy decongestion on telecom in the late- 90’s, has created a large, and aspiring lower-middle class, which is now looking for a better quality of life, access to healthcare, education, energy and infrastructure.
The earlier model of control economics which looked at job creation as a responsibility of the government, no longer holds, as business models as well as industry sectors go belly up, with disruptive technologies, and newer imperatives, such as quality of air, and climate change.
So, the solution of the day for wealth creation, job generation, and economic uplift is a Startup Revolution. If the dams, power stations, heavy machinery and steel plants were the “temples of modern India” in the fifties, Startups, using ubiquitous connectivity, global or local marketplaces, with global or local models of innovation, are icons of the day.
Here’s a link to the 19 main points shared at the end of day.: http://indiatoday.intoday.in/education/story/start-up-india-stand-up-india/1/573128.html)
But, here’s why it’s going to work.
- Self- Certification: and the most powerful idea is that it’s on mobile and online. Not only, does this up-end the license control inspector raj of the past, it also enables, say an entrepreneur in Imphal, or an aspirant in rural Chhattisgarh to join the start-up eco-system
- Tax Breaks: let’s not kid ourselves, this is the BIG one, and it’s there all over. For education institutes setting up incubators, corporates setting up accelerators, VC’s and angels who were shy to come to India, and preferred to operate out of Singapore, Dubai or Mauritius to avoid capital gains tax, and were also steadily weaning away India’s Unicorns to set up base there. This is IT! And if we look back at how textile exports powered our economy in the 80’s, and IT and ITes in the nineties and noughties, that’s the BIG differentiator. Those direct tax breaks, go and create jobs, livelihoods, attract talent, all of whom pay a lot more to the kitty via indirect taxes.
- Partnerships: Even the INR 10,000 crore investment, or the credit fund guarantee, is not dole. It’s a part commit by the government into the kitty. The expectation is that investors, banks, lenders, will quickly see the business model, and create business cases for investing in and championing risk. But, that’s just the tip of the ice berg. Throughout the 40-page handout shared at the Jan 17, 2016 event, industry- academia partnership and incubation is a full section, with interesting suggestions, and ideas, laid out.
Here’s why! I had the opportunity to be part of the India@100 mission plan where the concept of a country-wide backbone implementation network, which included social entrepreneurship models to provide basic services was being drawn. The elephant in the room, then and now, is that about 12 million young Indians will come of working age, each year from 2012 till 2025, that’s about 140 million people, in addition to the 40 million already unemployed. How do you create work for 200 million people?
So, while “Make in India” encourages global industry to create low-skill jobs in India, “Startup India” pushes the envelope even further, encouraging global investors to invest in entrepreneurs and startups to create a job-creating, wealth creating eco-system. Gotta run folks, have 5 more startups to help get off the ground this year.