In a bid to create an ecosystem that encourages new startups in the country, the government has taken an initiative to offer fiscal incentives to software start-ups. The aim behind the move is to bring in and sustain 10,000 new start-ups, which are expected to create 3.5 million jobs, directly or indirectly.
According to the news published in an online portal pc-tablet.co.in, with this particular initiative, the government aims at helping the sector account for $100 billion of India’s total GDP (around 1600 percent growth from the current $6.1 billion).
The policy that is going to be announced soon aims to offer incentives to start-ups with a revenue of over Rs. 25 crores and directly employ 25 people or more. The ministry also plans to allocate a certain portion of funds in electronic development fund that was created by the department of electronics and information technology and innovation fund created by the ministry of finance exclusively for the development domestic software product industry that is promoted by resident Indian nationals, the report stated.
The software industry in the country is valued at $143 billion, and by 2025, it has the potential to reach $350 billion. India accounts for a little over a third of the global software products industry that is valued at $411 billion. The value is said to reach $1 trillion by 2025, the report quoted the draft policy prepared by the Ministry of Communications.
Currently, the industry is largely sustaining or MNC funding, this will open up an array of options for both investors and ventures. The long-term sustainability of such an ecosystem will also depend on its linkage with the other sectors. The figures look a little far-fetched at the moment, but the growth rate looks quite promising.