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The Government of India has notified revised recognition criteria for startups, marking a significant shift in the eligibility framework to support the evolving innovation landscape. According to the Department for Promotion of Industry and Internal Trade (DPIIT), the turnover limit for an entity to be recognised as a startup has been increased from Rs 100 crore to Rs 200 crore. This adjustment aims to support enterprises at various stages of their business lifecycle as the Startup India initiative completes a decade in 2026.
"Keeping in view the evolving startup ecosystem and the need to support startups with targeted benefits at various stages of their business lifecycle, the turnover limit for recognition as a startup has been increased from Rs 100 crore to Rs 200 crore," DPIIT said in a statement. The new framework introduces a specific sub-category for "Deep Tech Startups," targeting entities engaged in breakthrough technologies. For these ventures, the government has expanded the age limit from 10 years to 20 years from the date of incorporation. Additionally, the turnover limit for deep tech entities has been set at Rs 300 crore. The government noted that this step addresses "the unique requirements of deep tech entities operating in areas with long gestation periods, high R&D intensity, and capital-intensive development cycles." In a move to foster grassroots innovation, the eligibility for startup recognition has been extended to cooperative societies. This includes Multi-State Cooperative Societies registered under the Multi-State Cooperative Societies Act, 2002, and those registered under State and Union Territory Cooperative Acts. DPIIT stated that this inclusion is intended to "support innovation-driven growth at the grassroots in agriculture, allied sectors, rural industries, and community-based enterprises." The revision follows observations that the startup ecosystem has shifted toward longer innovation cycles and higher capital intensity. DPIIT noted that several "innovation-led enterprises currently outgrow existing age or turnover limits while still in critical development or validation stages, resulting in premature loss of recognition and access to policy support." The updated criteria follow extensive consultations with various stakeholders, ministries, and departments. Recognised startups under this framework remain eligible for benefits including, access to government funding schemes, tax exemptions, and regulatory relief. These reforms are intended to "provide a more predictable, inclusive and future-ready policy environment for founders and to attract long-term patient capital into high-technology and R&D-intensive sectors." The initiative has recognised over 2 lakh entities since its launch in 2016. (ANI)
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