National Startup Day: Industry Experts Share How Government Policies Can Empower India's Startup Ecosystem

Muskaan Kapoor

Jan 16, 2025 — 10 min read

National Startup Day: Industry Experts Share How Government Policies Can Empower India's Startup Ecosystem

India has the third-largest startup ecosystem in the world. Startups in our country are playing an extremely important role in driving innovation, creating jobs, and boosting economic growth. Recognising the importance of startups, Prime Minister Narendra Modi declared 16th January as National Startup Day to celebrate the entrepreneurial spirit and innovation shaping the nation’s future.

While initiatives like Startup India have built a strong foundation, many industries still face unique challenges. These challenges need targeted policy interventions. This National Startup Day 2025, StartupTalky brings together insights from industry leaders, highlighting what they think could better support startups and drive growth in their industries. By addressing these needs, the government can help startups succeed in local and global markets.

Electric Vehicle Industry Growth

Nemin Vora, Founder and CEO of Odysse Electric Vehicles, shared, "We believe that EV sectors, especially the two-wheeler space, will continue to be a priority sector. This optimism comes from the shared goal of making transportation sustainable. We trust that the government will bring in incentives for both manufacturers and consumers, infrastructure development for EV charging, and policies to encourage research and development for the betterment of the EV space.

To better support startups in particular, and drive growth in the electric vehicle industry, we believe that the following policy changes and implementations would be highly beneficial:

Regulatory Support and Streamlined Approvals: Simplifying and expediting regulatory approvals for electric vehicles, along with implementing clear and consistent policies around safety and certification standards, would help startups enter the market more efficiently.
Promoting Incentives toward a Large Consumer Base: Government-backed awareness campaigns and direct consumer incentives, such as FAME-II subsidies or tax rebates for electric vehicle purchases instead of PLIs, would drive demand and encourage consumers to transition to electric mobility.
Access to Financing and Grants: Providing easier access to financial support through low-interest loans, grants, and venture capital funding for electric vehicle startups would enable companies to scale faster, invest in technology, and expand production capacities.
Reduced Taxes and Import Duties on EV Components: Lowering taxes and import duties on key electric vehicle components would make it more affordable for startups to produce electric vehicles domestically, which in turn would lower the overall cost of electric mobility.

These strategic policy changes would not only create a conducive environment for electric vehicle startups but also drive industry-wide growth, accelerate the transition to sustainable mobility, and help India meet its environmental goals."

Cybersecurity Industry Growth

Srinivas Shekar, Co-Founder and CEO of Pantherun Technologies highlighted a few key areas that the government should focus on to support startups and boost growth in cybersecurity:

Investing in AI-driven cybersecurity solutions can help tackle the growing threat of sophisticated cyberattacks.
Encouraging collaboration between public and private sectors and promoting innovation in homegrown technologies will also make a big difference.
Providing tax breaks for companies developing advanced cybersecurity tools and creating skill development programs to train cybersecurity professionals can strengthen the industry.
Expanding CERT-In’s resources and improving strategies to handle international cyber threats are equally important.

These steps will create an environment where startups can innovate, grow, and contribute to building a safer digital future.

Simplifying Fintech Regulations for Healthcare Financing

Sahil Lakshmanan, Chief Business Officer of CarePal Money stated that to better support startups, the government could:

Simplify regulatory processes for fintech startups, particularly around healthcare financing and patient data security.
Incentivize partnerships between startups and public hospitals to ensure widespread access to innovative financial solutions.

Logistics Industry Innovation and Growth

Anshul Jain, Co-founder and CTO of Roadcast, highlighted the impact of government policies like the Startup India Seed Fund Scheme in supporting startups. To further drive growth in the logistics sector, he suggested several measures that the government could consider:

Tax Benefits for R&D: Offering tax credits or subsidies for startups investing in AI, IoT, and other innovative technologies would encourage more technological advancements in the logistics space.
Improved Connectivity: Enhancing road, rail, and port connectivity would streamline supply chains, benefiting both logistics companies and customers.
Green Logistics Policies: Financial incentives for adopting fuel-efficient and sustainable practices could help companies reduce their environmental footprint.
Startup Tax Holidays: Extending tax holidays for early-stage startups would ease cash flow pressures and help businesses scale faster.
Skill Development Programs: Launching initiatives to train workers in AI, IoT, and supply chain management would ensure a skilled workforce to support growth in the sector.
Easier Access to Credit: Streamlining access to low-interest loans would provide logistics startups with the financial backing needed to expand and innovate.

IT Sector Transformation and AI Product Development

Neerja Kumar, Co-Founder and COO of Enalytix shared, "India’s IT sector has traditionally thrived on services, but in line with the Honourable Prime Minister’s Make in India vision, it is time to shift focus towards product development, particularly in emerging technologies like AI. To support this transformation, the government should introduce measures that foster innovation and global competitiveness in Indian IT products. Key initiatives could include creating a catalogue of Made-in-India products, particularly in AI, to enhance their visibility in international markets. Additionally, offering export incentives will encourage companies to scale their product offerings globally."

AI Adoption and Growth in Key Industries

Animesh Samuel, Co-Founder and CEO of E42.ai emphasised that policies promoting AI adoption in sectors like BFSI, healthcare, and manufacturing can drive growth. Providing tax incentives for AI-led automation, establishing funding programs for R&D, and fostering public-private partnerships would encourage innovation. Support for enterprise automation platforms like E42 through government-backed AI centers could enhance accessibility for SMEs, enabling them to leverage advanced technologies without breaking the bank. Streamlining data compliance regulations for cloud-based and on-premises deployments can further ease AI implementation.

Growth in Music-Tech Industry

Gaurav Dagaonkar, Co-founder and CEO of Hoopr stated, "For music-tech startups like ours, initiatives that further simplify and strengthen intellectual property regulations, provide access to affordable capital, and incentivize innovation in areas like AI and music technology will be crucial. We need a policy framework that not only supports the growth of India’s INR 10,000 crore creator economy but also fosters responsible innovation and empowers creators to thrive."

ESOPs and Startup Growth

Manish Panwar, Business Head at Xumane, suggested, "To better support startups and drive growth in the ESOP (Employee Stock Option Plan) and cap table management space in India, several changes or implementations in government policies could be considered:

Taxation Reforms for ESOPs
Incentivizing Investment in Startups
Supporting Employee Education and Awareness

By implementing some of these changes, the government could create a more vibrant ecosystem where startups are incentivized to grow and reward their teams through ESOPs while also ensuring that both entrepreneurs and employees are well supported in managing their equity and wealth."

EdTech Industry and AI Integration

Arpit Mittal, Founder and CEO of SpeakX, highlighted that the government has a unique opportunity to make technology a bridge, not a barrier. Policies that promote AI in education, like tax incentives for EdTech startups, could fuel innovation and bring personalized learning tools to underserved areas. Strengthening digital infrastructure—like affordable internet and devices for rural regions—is crucial. But it is not just about access; teachers also need support. Investment in training programs will ensure educators can use AI tools effectively in classrooms. Lastly, prioritizing data privacy regulations will build trust, so students and families feel secure using these platforms.

Personal Care Services Industry Support

Reshbha Munjal, Co-Founder of KorinMi, said, "While many policies today aim to promote startups in India, the real impact lies in how easily they can be implemented. Whether it’s getting tax rebates or loan approvals, simplifying these processes would make them far more accessible and empower entrepreneurs to focus on innovating. When policy meets opportunity, startups can become the catalysts of the change we need."

Retail Industry Growth and Innovation

Varun Tangri, Founder and CEO of QueueBuster, suggested that to support entrepreneurs and fuel growth, the government should prioritise infrastructure investments, particularly road networks, to improve connectivity and establish new retail hubs. Fast-tracking the National Retail Policy is critical for streamlining operations and providing a common foundation for business. Simplifying GST compliance, making finance more affordable, and encouraging tech usage would all help alleviate operational issues. Encouraging green retail activities through tax breaks or incentives would enhance sustainability. These steps will promote innovation, entrepreneurship, and a thriving startup environment, allowing enterprises to scale and contribute effectively to India's economic growth.

AI and Language Technology Industry Growth

Tapan Barman, Co-founder and CEO of Mihup, emphasised the importance of dedicated support for AI and language technology startups, particularly those focused on multilingual AI and voice interfaces. He suggested several measures that the government could take to boost this sector:

Dedicated Support for AI and Language Technology: Establish grants and incentives specifically for startups working on multilingual AI and voice interfaces, recognizing the importance of these technologies for India’s diverse population.
Accessible Data Frameworks: Create secure, government-backed frameworks for startups to access anonymized datasets that represent India's linguistic and phonetic diversity, which are critical for training voice AI systems.
Collaboration Initiatives: Facilitate partnerships between startups and public institutions, enabling real-world deployment of conversational intelligence platforms in sectors like healthcare, education, and public services.
Startup Tax Reforms: Provide tax relief for R&D-heavy startups and offer incentives for companies that are building indigenous AI solutions for global and local challenges.

These measures, as highlighted by Barman, are key to supporting the growth of AI technologies in India.

Plastic Recycling Industry and Policy Reform

Rahul Nainani, CEO and Co-Founder of ReCircle, discussed the need for a balanced policy approach for plastic recycling that considers social justice, environmental preservation, and economic growth. He suggested that the government could support long-term growth in the industry through tax reforms and lower GST rates on recycled plastic products. Nainani said:

"Higher taxes on the plastic industry could drive inflation, while technological innovation can help deliver better services and benefits to connected communities and the economy. For sustained industry growth, infrastructure support and digitization in plastics manufacturing are critical, as well as ensuring businesses comply with the government's Extended Producer Responsibility (EPR) mandates under the Plastic Waste Management Rules of 2016."

He also highlighted that ClimaOne’s strategy of ethically recycled plastics aligns with these EPR regulations, which require producers to integrate 30% recycled content into their products by 2025, with the percentage increasing annually.

Lubricant Industry Innovation and Growth

Navkaran Singh Sethi, MD and Co-Founder of EnerG Lubricants, suggested that government policies could focus on several measures to support startups in the lubricant industry, including:

To support startups in the lubricant industry, government policies could focus on:

R&D Tax Incentives: Offering tax breaks for innovation in high-performance additives and sustainability.
Access to Financing: Providing government-backed funding or low-interest loans to help startups scale.
Streamlined Regulations: Simplifying certification processes for meeting international standards and global market entry.
Technology Grants: Subsidizing startups adopting cutting-edge manufacturing technologies.
Workforce Development: Supporting educational and technical training programs to build a skilled workforce.

These measures would drive innovation, accelerate growth, and help Indian startups become global leaders in the lubricant industry.

Data Privacy and Ethics in Residential Tech

San Banerjee, Co-Founder and CEO of ADDA, expressed concerns about unethical practices in the residential community tech industry, particularly regarding the misuse of data for advertising and other monetisation purposes. He emphasised the following points:

Data Privacy and Cybersecurity: Stricter guidelines around data privacy and ethics should be implemented to protect the interests of apartment owners and residents who use these platforms. ADDA’s model remains ad-free, and spam-free, and ensures zero risk for users.
Supporting Ethical Solutions: Policies that promote ethical practices would encourage serious solution providers to enter the market, fostering a safer and more reliable environment for users.

Apparel Sourcing Industry Growth

Abhishek Dua, CEO and Co-Founder of Showroom B2B, shared that to support startups and drive growth in the apparel sourcing industry, the government should focus on streamlining compliance regulations, making it easier for small manufacturers to join organised supply chains. Expanding affordable financing, such as low-interest loans, would help startups scale and manufacturers upgrade technology. Investments in logistics and infrastructure, like transportation and warehousing, would enhance supply chain efficiency. Grants for sustainable practices would encourage eco-friendly operations, aligning with global standards.

Additionally, export incentives for startups working with compliant manufacturers could boost international competitiveness, while skill development programs focused on technology, compliance, and quality standards would uplift manufacturers, fostering a more efficient and scalable ecosystem.

Workforce Development and Job Creation

Nilesh Dungarwal, Co-founder and CEO of WorkIndia highlighted that policies like SEZ expansions can create jobs and incentivize the development of new capabilities. He believes that the government’s focus on upskilling and job creation is crucial. According to Nilesh:

"Young people in India have a lot of potential, but to match talent with industry demands, focused skill development programs are required. By prioritizing entrepreneurship, workforce readiness, and a robust startup ecosystem, the government can unlock innovation, accelerate growth, and create sustainable opportunities across sectors, driving long-term economic transformation."