Indian start-up industry is growing by leaps and bounds. In the field of technology, Indian start-up industry stands at the third position in the world after US and UK. The start-ups are looking forward to carving a niche for themselves in the competitive market despite all the hurdles and regulations. There are numerous regulations by the government that are somehow preventing the startup industry to unleash its full potential. There are many changes that Indian start-ups are looking forward to, to make the whole process smooth. The young entrepreneurs are looking for less frictional policies and framework identical to those in the US that can create a more conducive environment here in India.
Below are the changes that Indian start-ups are expecting in the country:
Starting a company in the US is a simple task, three forms are all that is needed, at the most. In India, starting your own firm is a long and tedious process but the government is trying making it easy for entrepreneurs. Even if you start it, the road ahead is paved with many challenges that are financially draining. The paperwork takes a lot of time and energy. In the US, people are known to even start with no funds and running a successful business from a shack.
- Indian investors have to shell out a whopping 10+% long term capital gain tax, which is unlikely in the US. It is difficult for the startups to register in India which is why they relocate the company to countries like US or Singapore that offer flexibility. It will be a boon for Indian startups if the tax law can be amended for their profit.
- In case you want to shut down your start-up, the laws will give you no respite. It takes years in India to liquidate a company completely unlike in the US. This leaves no room for innovation as compared to the Silicon Valley, a hub for new ideas. The entrepreneurs want laws in the country to be little flexible to make shutting down easier before we move to conceptualising the next big idea.
- The government policies in India lack clarity in terms of tax and litigation. The investors in India are not so keen in risking their money in lieu of changing policies every now and then. Policy-making in India remains inconsistent and prone to changes that make the future blurry in terms of investments. In the US, policies are made once and for all taking into consideration proper measures and constraints. This creates an environment in India which makes investing in start-ups less profitable. This is something that needs immediate attention from our government.
- To set up a business, you have to juggle through piles of paperwork in India which is a daunting task. That rarely happens in the US as they don’t have strict compliance laws or the ones that make no sense in the present times. Here in India, you need to get the same licences for an online business as that in the case for offline ones. For instance, if you sell a certain food product online, you need to take same manufacturing licence or shop permit as you would need to if you are having your own shop. The start-ups are urging for changes that make their business easy regardless of the mode.
The start-ups long for a friendly business climate here in India and support from the government regarding the favourable policies. The US has already realised this and India need to follow it by making amendments. The start-ups are looking forward to new policies by the government that will boost entrepreneurship as well as fuel the growth of their businesses.