Centre for Distance and Online
Education (CDOE)
Module -3
Entrepreneurship Development & Government support system
From:
Dr.Mohan N.
Asso.Professor
CMRIT-MBA
Centre for Distance and Online
Education (CDOE)
Entrepreneurship Development & Government support system
• Syllabus: Business Angles, Venture Capitals, Initial Public offerings, Role of Central government
& State Supports,
• Government Supporting Entrepreneurship –Introduction to Various Incentives, Subsidies &
Grants Exports Oriented Unites.
• A Brief Overviews of Financial Institutions in India – SIDIB- SIDCO- DIC- Single window- Latest
industrial Policy of Government of India
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A Comprehensive
Guide to Business
Financing
This presentation explores the essential elements of business
financing, including various funding options and the crucial roles
of different stakeholders. Gain valuable insights into the diverse
landscape of business financing, from angel investments to
government support.
by Dr Mohan N
Centre for Distance and Online
Education (CDOE)
Understanding Angel Investors
1 High-Net-Worth Individuals 2 Hands-On Mentorship
Angel investors are wealthy individuals who invest in Angel investors often provide mentorship and guidance
early-stage companies with high growth potential. in addition to financial capital.
3 Focus on Innovation 4 Risk Tolerance
Angel investors typically invest in innovative businesses Angel investors are comfortable with high-risk
with disruptive technologies or unique products. investments, expecting substantial returns.
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The Role of Venture Capital Firms
Investment Strategy Expertise and Resources Exit Strategies
Venture capitalists invest in high- VC firms provide access to a VC firms often aim to exit their
growth potential companies network of experts, industry investments through an IPO or
across various stages of knowledge, and operational acquisition, generating significant
development. support. returns.
• Seed Stage 1. Financial Analysis
• Early Stage 2. Marketing and Sales
• Growth Stage 3. Legal and Regulatory
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Initial Public Offerings (IPOs)
1 Preparation
Companies prepare their financial statements and
disclose information to potential investors.
2 Underwriting
Investment banks underwrite the IPO and manage
the process of selling shares to investors.
3 Listing
The company's shares are listed on a stock
exchange, allowing the public to trade them.
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Importance of Central
Government Policies
Tax Incentives Infrastructure Development
Government policies can Investing in transportation,
encourage investment by energy, and communication
offering tax breaks and infrastructure can facilitate
subsidies to businesses. business growth.
Regulatory Framework Skill Development
Programs
Clear and predictable
regulations promote stability Government initiatives can
and attract foreign investment. support education and training
programs to create a skilled
workforce.
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State Government Incentives
and Support
Financial Assistance
States offer grants, loans, and tax credits to support
startups and small businesses.
Business Development Programs
State governments provide mentorship, training, and
networking opportunities for entrepreneurs.
Infrastructure Investment
States invest in local infrastructure, including roads,
utilities, and technology infrastructure.
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Accessing Funding
Opportunities
Networking Business Plan
Attend industry events, join Develop a compelling business
professional organizations, and plan that outlines your company's
connect with investors and vision, strategy, and financial
mentors. projections.
Pitching Crowdfunding
Practice your pitch and be Explore online crowdfunding
prepared to effectively platforms to raise funds from a
communicate your business value large number of individuals.
to potential investors.
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Navigating Regulatory
Frameworks
Compliance Understanding and adhering to
relevant regulations, including
corporate governance, securities
laws, and industry-specific rules.
Legal Advice Seeking legal counsel to ensure
compliance, navigate complex
legal issues, and protect the
company's interests.
Transparency Maintaining transparency in
financial reporting, operations,
and dealings with investors and
regulatory bodies.
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Successful Case Studies
Company A Company B
Company A successfully raised seed funding from angel Company B successfully navigated the IPO process and
investors and later secured a venture capital achieved a strong market valuation.
investment.
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Conclusion and Key
Takeaways
Business financing is a complex process that requires a
comprehensive understanding of funding sources, government
support, and regulatory frameworks. By leveraging diverse
funding options, navigating regulations effectively, and
embracing innovation, businesses can achieve sustainable growth
and success.
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Financial
Institutions in India
India's diverse financial landscape is a complex ecosystem of institutions
playing a crucial role in the nation's economic development. This
presentation provides a brief overview of key financial institutions,
highlighting their contributions to the growth of India's industries.
by Dr Mohan N
Centre for Distance and Online
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Small Industries Development
Bank of India (SIDBI)
SIDBI is a financial institution specifically focused on promoting, financing, and
developing India's small and medium enterprises (SMEs). It provides a wide range of
financial services, including loans, equity, and technical assistance to SMEs across
the country.
SME Development Financial Services
SIDBI plays a vital role in the growth SIDBI offers a variety of financial
of SMEs, providing crucial financial services, including loans, equity, and
support and guidance, contributing technical assistance tailored to the
to job creation and economic specific needs of SMEs.
prosperity.
Industrial Development
SIDBI's contributions extend beyond financial support; it actively promotes the
development of industries, fostering innovation and entrepreneurship.
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State Industrial Development Corporations
(SIDCOs)
Each state in India has its own SIDCO, which acts as a catalyst for industrial development within the state. These corporations
offer various services to industries, including land allotment, financial assistance, and infrastructure development.
State-Specific Focus Industrial Growth Infrastructure Development
SIDCOs tailor their services to the SIDCOs play a crucial role in
unique needs and challenges faced by facilitating industrial growth, By providing infrastructure such as
industries within their respective attracting investment, and creating industrial estates, SIDCOs create an
states, promoting regional growth. job opportunities in their respective enabling environment for industries to
states. thrive and contribute to the state's
economic progress.
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District Industries Centers (DICs)
DICs are established at the district level to provide a single point of contact for
entrepreneurs and industrialists seeking assistance. They offer guidance on setting
up new businesses, provide access to government schemes, and facilitate business
development.
1 Entrepreneurial Support 2 Government Schemes
DICs offer guidance to budding DICs provide access to
entrepreneurs, helping them government schemes and
navigate the complexities of financial assistance, simplifying
setting up and running a the process for businesses
business, fostering a supportive seeking support for growth and
environment. development.
3 Business Development
DICs offer a range of services to promote business development, including
training programs, workshops, and market linkages, fostering a vibrant
business ecosystem.
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Single Window Clearance
System
The single window clearance system is a simplified and streamlined process for
obtaining necessary approvals and permits for setting up new businesses. This
system eliminates the need for multiple interactions with different government
agencies.
Application Submission
Entrepreneurs submit a single application with all necessary
documentation, simplifying the process and saving time.
Centralized Processing
The application is reviewed and processed by a single designated
authority, eliminating bureaucratic hurdles and delays.
Approval and Issuance
Upon approval, all necessary permits and licenses are issued promptly,
facilitating a smooth transition for new businesses.
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Latest Industrial Policy of the
Government of India
The latest Industrial Policy of the Government of India aims to foster a robust and
competitive industrial ecosystem, promoting growth, job creation, and a shift
towards a knowledge-based economy. Key pillars of the policy include promoting
manufacturing, innovation, and digitalization.
Promote Manufacturing Encourage domestic production,
creating jobs and enhancing the
country's global competitiveness.
Innovation and R&D Foster a culture of innovation and
research and development, leading
to technological advancements and
increased productivity.
Digitalization Embrace digital technologies to
enhance efficiency, improve
connectivity, and create new
opportunities for businesses.
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Objectives of the Industrial Policy
The Industrial Policy outlines several objectives, including fostering sustainable and inclusive
industrial growth, promoting job creation, enhancing global competitiveness, and promoting
innovation and technology adoption in various sectors.
Sustainable Growth Job Creation
The policy aims to achieve sustainable and The policy emphasizes job creation through
inclusive industrial growth, ensuring economic promoting manufacturing, innovation, and
development benefits all segments of society. digitalization, creating employment
opportunities for the Indian workforce.
Global Competitiveness Innovation and Technology
The policy aims to enhance India's global The policy emphasizes promoting innovation
competitiveness by promoting manufacturing and technology adoption across industries,
excellence, innovation, and attracting foreign driving efficiency, productivity, and
investment. competitiveness.
Centre for Distance and Online
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The policy focuses on various initiatives, including improving infrastructure, fostering skill development,
promoting ease of doing business, and facilitating access to finance for industries, creating a favorable
environment for growth.
1 Infrastructure Development
Investments in infrastructure, such as roads, railways, and ports, are crucial for supporting
industrial growth and efficient transportation.
2 Skill Development
Training programs and skill development initiatives are essential for ensuring a skilled workforce
capable of meeting the demands of modern industries.
3 Ease of Doing Business
Simplifying regulations and procedures related to starting and operating businesses creates a
more conducive environment for entrepreneurship.
4 Access to Finance
Providing access to finance through government schemes, credit guarantees, and financial
institutions is crucial for supporting industry growth.
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Challenges Faced by Financial Institutions
Financial institutions in India face various challenges, including managing non-performing assets (NPAs), navigating a dynamic
regulatory environment, and ensuring financial inclusion for underserved populations.
Non-Performing Assets (NPAs) Dynamic Regulatory Financial Inclusion
Environment
Ensuring access to financial services for
High levels of NPAs pose a significant The rapidly changing regulatory underserved populations, including rural
challenge to banks and financial landscape can be challenging for communities and marginalized groups,
institutions, impacting their profitability financial institutions, requiring constant remains a significant challenge.
and lending capacity. adaptation and compliance.
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Conclusion and Future Outlook
Financial institutions in India play a crucial role in supporting the country's economic
growth. Their commitment to providing financial services, fostering
entrepreneurship, and supporting the growth of industries is essential for India's
continued economic progress.
Innovation and Technology Financial Inclusion
Financial institutions are increasingly Financial institutions are actively
embracing technology and working to expand financial
innovation to improve efficiency, inclusion, ensuring access to
enhance customer experience, and financial services for all segments of
expand reach. society.
Sustainable Development
Financial institutions are increasingly focusing on sustainable development,
supporting businesses and projects that promote environmental and social
responsibility.
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Indian
Government’s
Entrepreneursh
ip Support
This presentation delves into the Indian government's robust ecosystem
of support for budding entrepreneurs, highlighting the numerous
incentives, subsidies, and grants designed to empower and drive the
nation's economic progress.
by Dr Mohan N
Centre for Distance and Online
Education (CDOE)
Importance of
Entrepreneurship for India’s
Economic Growth
Entrepreneurship plays a vital role in driving India's economic growth by fostering innovation,
creating jobs, and boosting productivity. It fuels a dynamic ecosystem where new ideas
flourish, leading to economic diversification and prosperity.
1 Job Creation 2 Innovation and Technology
New businesses create numerous Entrepreneurs often drive innovation,
employment opportunities, addressing introducing new technologies and
the challenge of unemployment, products, enhancing competitiveness in
particularly among youth. the global market.
3 Economic Diversification 4 Social Impact
Entrepreneurs often explore new and Entrepreneurial initiatives can address
emerging sectors, contributing to the social issues, creating solutions for
diversification of the Indian economy, rural development, healthcare, and
reducing reliance on traditional education, promoting social inclusion.
industries.
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Overview of Incentives,
Subsidies, and Grants
The Indian government offers a range of financial incentives, subsidies, and grants
to support entrepreneurs and their ventures. These programs aim to reduce
financial barriers and encourage the establishment and growth of businesses.
Incentive Type Description Benefits
Tax Incentives Tax deductions and Reduced tax burden,
exemptions for startups more capital for growth
and entrepreneurs
Subsidies Direct financial Lower operational
assistance for specific costs, enhanced
sectors or activities competitiveness
Grants Non-repayable financial Funding for innovative
support for research, ideas and projects,
development, or fostering research and
specific projects development
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Startup India Initiative
Launched in 2016, the Startup India Initiative provides a comprehensive framework for
supporting startups in India, including simplified procedures for registration, access to funding,
and mentorship.
1 Registration
Simplified process for registering startups, reducing bureaucratic hurdles and
making it easier to establish a business.
2 Funding Support
Access to seed funding, venture capital, and other forms of financial support for
early-stage startups.
3 Mentorship and Networking
Connecting startups with mentors, investors, and industry experts, providing
guidance and support for growth.
4 Incubation Centers
Establishment of incubation centers to provide startups with access to resources,
infrastructure, and mentorship.
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Make in India Program
The Make in India program aims to promote domestic manufacturing and attract foreign investment, making India a global hub
for production and innovation.
Incentives Skill Development Infrastructure Development
Tax breaks, subsidies, and other Focus on developing a skilled Investments in infrastructure, such as
financial incentives to encourage workforce to meet the demands of roads, ports, and power, to facilitate
investment in manufacturing. modern manufacturing. industrial growth.
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Atal Innovation Mission
The Atal Innovation Mission (AIM) promotes innovation and
entrepreneurship at the grassroots level, fostering a culture of innovation
and creativity among students, teachers, and communities.
Atal Tinkering Labs Atal Incubation Centers
Setting up innovation labs in Providing support and resources
schools to encourage for startups in various sectors,
experimentation and hands-on including technology,
learning, fostering a culture of healthcare, and agriculture.
innovation.
Atal New India Challenges
Launching competitions and challenges to encourage the
development of innovative solutions for societal problems.
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Credit Guarantee Scheme
for Startups
The Credit Guarantee Scheme for Startups aims to ease access to credit for startups
by providing guarantees to banks, reducing their risk and encouraging them to lend
to young ventures.
Reduced Risk
Guarantees to banks reduce the risk associated with lending to
startups, encouraging them to provide credit.
Increased Access to Capital
Startups can secure loans more easily, enabling them to invest in
growth, expansion, and operations.
Enhanced Funding Opportunities
The scheme promotes a healthy lending environment for startups,
fostering their growth and contributing to economic development.
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Merchandise Exports from
India Scheme (MEIS)
The Merchandise Exports from India Scheme (MEIS) offers a reimbursement of duties and taxes
paid on exported goods, making Indian products more competitive in the global market.
Increased Competitiveness
By reducing export costs, MEIS makes Indian goods more competitive in international markets.
Boost to Exports
The scheme incentivizes businesses to export, contributing to India's overall export performance.
Economic Growth
Increased exports contribute to job creation, foreign exchange earnings, and overall economic growth.
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Export Oriented Units (EOUs) and their Benefits
Export Oriented Units (EOUs) are special economic zones where businesses can operate with exemptions from duties and taxes, making them
attractive for export-focused companies.
1 Duty Exemption 2 Simplified Procedures
EOUs are exempt from import duties and taxes on raw EOUs enjoy streamlined customs procedures, facilitating
materials and components, reducing production costs. smoother export operations.
3 Investment Incentives 4 Global Competitiveness
EOUs often receive incentives for investment in infrastructure, By reducing costs and streamlining processes, EOUs enhance
technology, and job creation. the competitiveness of Indian exports in the global market.
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Conclusion:
Empowering
Entrepreneurs,
Driving India's Future
The Indian government's commitment to supporting entrepreneurs is
evident in the diverse range of programs and initiatives designed to
empower startups, boost innovation, and drive economic growth. These
measures are crucial for propelling India towards a brighter, more
prosperous future.
