Arunachal Pradesh, also known as the land of the rising sun, boasts breathtaking scenery, a rich cultural heritage, and diverse wildlife. The state is home to many indigenous tribes, each with its distinct customs and traditions, and Itanagar serves as its capital. Tourists flock to this destination to enjoy its natural beauty and visit popular tourist spots such as Tawang, Itanagar, Ziro, Namdapha National Park, and the Sela Pass. Its famous cuisine includes delicacies such as smoked meat, Lukter, Bamboo Shoot, Chura Sabji, Momo, etc.
Arunachal Pradesh's Start-up Policy: A Game-Changer for Entrepreneurs
While the state's tourism industry thrives, Arunachal Pradesh has also become a hub for startups. The state's impressive startup policy provides a range of incentives to entrepreneurs, making it an attractive destination for new businesses.
The state government's Start-up Policy 2022-23, is packed with enticing incentives to help entrepreneurs unleash their creativity, generate employment, and boost the state's economy. From financial assistance to infrastructure support, this policy is a game-changer for startups in Arunachal Pradesh.
Successful Startups in Arunachal Pradesh
The successful startups from Arunachal Pradesh include Albe.in, Arunachal Pixels, Advanced Security Television ( ASTV), AYANG ADVISORS, Bamboo Straw Production Centre (BSPC), etc
Arunachal Pradesh's Startup Policy
To transform Arunachal Pradesh into a global hub for innovation and entrepreneurship by providing holistic support to local startups through proactive policy intervention and the creation of a network of key ecosystem stakeholders.
What are the criteria to be recognized as a startup in Arunachal Pradesh?
An entity shall be eligible to be recognized as a ‘Startup’ under the Arunachal Pradesh Startup Policy if it is recognized under the Startup India initiative by the Central Government. Additionally, it should be incorporated or registered in Arunachal Pradesh or registered with the GST Commissionerate in Arunachal Pradesh.
To access the incentives outlined below, startups must submit their business proposals through the online portal of the Investment Division. The proposals will then be verified and presented to the Startup Council for necessary examination and approval. However, it's important to note that all startups must go through an established selection process and will not be automatically entitled to receive the incentives.
What are the different incentive schemes offered by Arunachal Pradesh?
Support Grant Scheme - The first incentive is the Idea Support Grant, which will be provided to 50 startups each year for the five years of the policy period. The Investment Division, along with state-based startups, will organize annual entrepreneurship challenges and select the top ten winners each year to receive Rs. 5,00,000/- and offer for incubation. The next forty winners will receive Rs. 4,00,000/- and offer for pre-incubation, based on established selection criteria, including minimum qualification criteria.
Support for Proof of Concept
The second incentive is the Support for Proof of Concept (PoC), which will be available to eligible startups. Under the Government of India’s SISFS, seed fund up to Rs. 20,00,000/- will be disbursed by the incubator as a grant for validation of proof of concept, prototype development, or product trials. The grant will be disbursed in milestone-based investments as per applicable guidelines, and eligible incubators and startups will receive support from the Investment Division to apply for this grant. For startups who are not accommodated under SISFS, the state government will provide one-time fiscal support as a grant for validation of proof of concept, prototype development, or product trials for up to 100% of the capital expenditure towards the cost of production for the proof of concept, subject to a limit of Rs. 10,00,000/-. The aim of the policy is to provide this support to a total of 100 startups over the five years of the policy period. However, this funding support is liable to be fully or partially recovered in case the agreed-upon milestones are not met.
The government of the State is taking several initiatives to promote entrepreneurship and innovation among startups. One of the key areas where the government is focusing is research and development. To encourage startups to invest in R&D activities, the government is providing R&D incentives to eligible startups. Under this incentive, startups can receive up to 50% of the capital cost of research expenses, subject to a maximum limit of Rs. 5,00,000/-. The government aims to provide this support to a total of 50 startups over the five years policy period.
Apart from R&D incentives, the government is also providing financial support to startups for filing and prosecuting patent applications. The cost of filing and prosecution of patent applications will be reimbursed to eligible startups for up to 100%, subject to a maximum limit of Rs. 10,000/- per Indian patent awarded and up to 100%, subject to a maximum limit of Rs. 1,00,000/- per international patent awarded. The government aims to provide this support to a total of 100 startups for Indian patents and 50 startups for international patents over the five years policy period.
Quality Certification Incentive
In addition to R&D incentives and patent cost reimbursement, the government is also providing support to startups for obtaining quality certification. The fee payable for obtaining various certifications such as BIS, ISO, CMMI, FSSAI, AGMARK, HALLMAPK, SILK MARK, ZED Certification, etc. will be subsidized, and a one-time reimbursement will be provided for up to 100% of the cost of certification, subject to a maximum limit of Rs. 5,00,000/- per startup. The government aims to provide this support to a total of 100 startups over the policy period.
The government is offering a domicile incentive to startups that are fully domiciled in the State. Startups whose people, product, market, and impact are confined within the State can receive a one-time grant of up to Rs. 1,00,000/-. This grant will be paid as partial reimbursement for lease rental for hired premises for a period of one year, subject to strict scrutiny of the evaluation committees. The government aims to provide this support to a total of 50 startups over the policy period.
Incentive for Women and Differently-Abled
The government is providing a recruitment incentive for women and differently-abled employees. Startups that employ women and differently-abled employees who are domiciled in the State can receive a one-time recruitment incentive of up to Rs. 40,000/-. This incentive will cover up to 40% of the cost towards the salary of such employment over a period of one year, subject to strict scrutiny of continuous employment. The government aims to provide this support to a total of 150 startups over the policy period.
The Scale-up Grant, part of the Startup India Seed Fund Scheme (SISFS), offers up to Rs. 50,00,000/- to incubators to disburse to startups for market entry, commercialization, or scaling up through convertible debentures or debt-linked instruments. The Investment division of the government will provide support to eligible incubators and startups to apply for this grant. For startups not eligible under SISFS, the government will partially reimburse the cost of scaling up products or initiatives that have proven potential for large-scale employment generation or other highly beneficial parameters. The reimbursement will cover up to 75% of the cost, subject to a limit of Rs. 25,00,000/-, and can only be used for capital expenditure such as raw material purchase, marketing, and scaling up costs required for supporting the commercialization of products or services. The policy aims to provide support to a total of 25 startups over the five years of the policy period.
The Digital Up-scaling Subsidy is another grant that offers a one-time digital upgradation subsidy to eligible startups in India. The subsidy reimburses startups for the procurement and upgradation of high-end computers, relevant hardware, software, and other related expenses up to a limit of Rs. 10,00,000/- per startup. The government prefers to support the adoption of disruptive technologies such as Artificial Intelligence (AI), Machine Learning (ML), Blockchain, and other emerging technologies as defined by Startup India. The policy aims to provide this support to a total of 25 startups over the five years of the policy period. These grants will go a long way in supporting eligible startups and promoting entrepreneurship in India, contributing to the country's economic growth and development.
State of Natural Beauty and Innovation
Arunachal Pradesh is not only a beautiful tourist destination but also a promising hub for startups. With its impressive startup policy and a range of incentives, the state government aims to transform the region into a global center for innovation and entrepreneurship. Through the various incentive schemes outlined in the policy, startups in Arunachal Pradesh have the opportunity to unleash their creativity, generate employment, and contribute to the state's economy.