Abstract
India’s start-up ecosystem has grown phenomenally over the last decade, but it has emerged as a key driver for the nation’s economic development.
This article discusses the rise and growth of startups with relation to the economic growth of India.
Introduction
The Indian start-up ecosystem is on a tremendous growth as per ” startup India” 2022 , with an increasing number of entrepreneurs strating innovating companies serving as driver of economic growth and transformation.
Therefore, the rise of startups is variously supported by a combination of venture capital , talented and educated labour and the creation by the Indian government of a policy environment that provides support.
Expansion of India’s start – up.
The Indian start-up landscape has grown in last decade. Currently, India hosts 80,000 startups os which more than one 100 are unicorn ,that is company valued at $1 billion , thus making India the third – largest startups ecosystem in the world.
The rapid growth has been fueled by several reasons :-
- Venture capital and funding : The rush of venture capital has been the main reason for India in growth of startups.
- Supportive Government policy : A number of policies were announced by the government of India, including ” start- up initiative” 2016
- Technological advancements and digital infrastructure : The digilatization of internet and phones at back of relatively affordable data rates , has helped in the rise of digital startups.
Results
- Economic Impact : Quantitative analysis indicates the startup has given a substantial boost to the economic growth of India , estimated at around 2-3% of its GDP . The enabling technology and digital sectors drive this, contributing almost 5% of GDP.
- Social and cultural Impact : Qualitative analysis brought out the fact that this development of startups is not only economic, but s socio – culture phenomenon. The exposure to western culture and media such as, the ” shark tank” , shows has emerged as impressive among Indian youth.
- Impact on education and students : Growth of startups has consequently affected education sectors and students at large. There has also been a growth in student -led startups , with several universities setting up incubation centres to handhold young entrepreneurs.
Case study
The introduction of GST in 2017 can be highlighted as one of the incidents example of representating the government policies affecting the startup ecosystem. This policy changed had an enormous positive impact, more so for the SMEs , which are a large group in the startup ecosystem of India. According to IIM Bangalore , post GST witnessed a 25% increase in the registration of new startups , which shows how successfully policy has worked to trigger entrepreneurial activities.(IIM Bangalore 2019)
Conclusion
The rise of startups in India has been transformative force that has helped shape the economic contours of the country. It has contributed significantly to not only to the GDP and economic growth but also to developing a culture for innovation and entrepreneurship. It marks a new turning point for economic and social transformation of the country. India will be able to assist in its economic growth and social development in the long term.
References :
- Startup India ( 2022)
- Economic survey (2023)
- Government policy on startups.
- Online websites
- India venture capital report (2022)
