As entrepreneurship thrives, the Indian government has reinforced its efforts to make India's environment conducive to the growth of startup culture. GOI is committed to fostering innovation by introducing new startup grants and funding schemes. These initiatives address funding gaps, encourage research and development, and help businesses scale efficiently. In 2025, several government programs and corporate-backed accelerators will be available to support early-stage and growth-stage startups.
Startup India Initiative
Launched in 2016, The Startup India Initiative remains one of India's most significant programs supporting entrepreneurs. This flagship initiative offers tax benefits, easy compliance, and access to funding to promote innovation. Startups recognized by the Department for Promotion of Industry and Internal Trade can avail of benefits such as:
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Tax exemption for the first three years
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Self-certification under labor and environmental laws
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Government procurement preference
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Simplified regulations for business setup and operations
The Fund of Funds for Startups under this initiative, managed by the Small Industries Development Bank of India (SIDBI), continues to provide crucial financial support.
Startup India Seed Fund Scheme
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The Startup India Seed Fund Scheme is a government-backed fund that provides critical capital to early-stage startups. The scheme offers up to ₹50 lakhs for prototype development, market entry, and scaling operations.
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The DPIIT-recognized startups less than two years old at the time of application with a business model with market potential and scalability are eligible for this scheme.
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More than 300 incubators across the country are affiliated with this scheme, ensuring that startups receive funding and mentorship.
Technology Development Board Grants
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The Technology Development Board has introduced a Call for Proposals for Tech Startups. This initiative aims to accelerate the commercialization of technological innovations and bridge the gap between research and market-ready products.
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It focuses on Tier 2 and Tier 3 cities to encourage regional entrepreneurship. It grants funds to cover early-stage funding and commercialization costs, with preference given to startups in the AI, biotech, and deep-tech sectors.
Credit Guarantee Scheme
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Through the Startup Credit Guarantee scheme, startups can avail collateral-free loans. Startups often face difficulties securing funding due to a lack of tangible assets or an established credit history.
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Hence, the GOI facilitates their financial needs without burdening them with rigid collateral requirements. This government initiative ensures that startups have easier access to institutional credit.
Enhanced Credit Support
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In 2025, Startups can benefit from a doubled guarantee cover of ₹20 crore and a reduced fee of 1% for loans in 27 priority sectors.
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A new term loan scheme offers up to ₹20 crore with enhanced guarantee cover to strengthen global competitiveness.
Support for First-Time Entrepreneurs
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A new scheme of GOI offers funds of ₹10,000 crores to expand support for blooming startups.
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Five lakh first-time individuals, including women, Scheduled caste, and Scheduled tribe entrepreneurs, will be offered term loans up to ₹2 crore over five years. This initiative incorporates lessons from the Stand-Up India scheme and includes online capacity building for entrepreneurship and managerial skills.
Manufacturing and Clean Tech Initiatives
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The National Manufacturing Mission furnishes policy support and roadmaps for industries under the Make in India initiative, stressing clean tech manufacturing. This includes stimulating domestic production of solar PV cells, EV batteries, wind turbines, and high-voltage transmission equipment.
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These measures of GOI reflect its commitment to strengthening the MSME sector, fostering innovation, enhancing competitiveness, and ensuring better access to financial and infrastructural resources.
In 2025, the Indian government will continue to play a crucial role in nurturing startup ecosystems across various industries. Apply for these grants to avail yourself of the benefits. Contact Lawgical India Business Developers Pvt. Ltd. to navigate this process effectively. We will help you figure out the key legal requirements and fulfil them on your behalf.
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