As the government readies an action plan for startups, an investors' body today sought tax incentives on investments and easier norms for opening and closure of a company to give a boost to such ventures. Investors' association TiE Silicon Valley President Venktesh Shukla said a large number of startups are failing and "we should allow them to close their units in an easy way. It is extremely critical because lot of their energy is wasted in unproductive work".
Norms should also be eased for Indian startups to raise money, he said while interacting with media on the 'Startup India' event to be held tomorrow, when Prime Minister Narendra Modi will unveil an action plan to encourage budding entrepreneurs. The other members of the association asked for tax incentives in all investments coming from the US. Kanwal Rekhi, managing director of Inventus Capital said that India does not impose tax on investments in capital market but levies investments in startups.
"Investment made from Mauritius is not taxed but those made from the US come under tax ambit. We don't want to invest through indirect route, we want to make investment directly from Silicon Valley to India," Rekhi said. The members of the association emphasised on simple regulatory regime for new age ventures in India and global investors.
About 40 leading CEOs, venture capitalist and angel investors from Silicon Valley are attending the function. SoftBank CEO Masayoshi Son, WeWork Founder Adam Nuemann and Uber Founder Travis Kalanick will be among the top executives. "There is an incentive to invest in stock markets but disincentive to invest in startups.
Why so?," Rekhi said, hoping for some good announcement tomorrow. He said that 70 per cent of the jobs in the US are created by small units and this model can also be replicated in India. Hindustan Semiconductors Manufacturing Corporation Chairman Deven Verma said Indians in Silicon valley are no different but perform extraordinarily because of environment there.
"We need to develop Silicon valley-kind of environment in India," Verma said. Sharing similar views, Vinod Dham, Executive Managing Director, IUVP, said jobs in India will be created by startups, "so why give them step-motherly treatment." "We have seen so many companies making billions of dollars. This government has a vision.
This was not there in last ten years. Narendra Modi is trying to rally relevant people around that vision- entrepreneurs, investors," Dham added. Speaking at the briefing, DIPP Secretary Amitabh Kant said that all these people will meet the Prime Minister and would also invest here.
As many as 2,000 startups would offer key inputs to the action plan. The plan is expected to highlight initiatives and schemes being undertaken by the government to address various aspects on developing a conducive startup ecosystem in the country.
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