The Department for Promotion of Industry and Internal Trade (DPIIT) has approached large corporations like Apple, Tata Group, Hyundai, Skoda and Maruti and unicorns like boAT, Moglix, Meesho and EaseMyTrip to set up incubators for manufacturing startups in India, according to people in the know.
The DPIIT has shared a memo with the companies that gives a blueprint of how to create these incubators and says that they can seek government funding for the same.
Moneycontrol has reviewed the document.
"It is a voluntary thing. The government has just made a request to the companies as it believes there are not many manufacturing incubators in the country at present… Almost all big companies and unicorns have been approached," said a person close to the developments.
“There is no special monetary corpus planned for the initiative as yet. But, it might happen in the future,” he added.
In the memo, the DPIIT has presented the strategies and impact of six major corporations that engage with startups. These include Amazon, Nike, Samsung, BMW, Astrazeneca and Spotify.
"Through technology transfer from incubated startups, corporates can gain competitive advantage in markets and gain new customers... Developing a new innovation is time and resource intensive. Working with incubated startups can help reduce these costs," it says.
The document lays out several avenues of funding which can be used by corporate incubators to cover expenses such as apply for support from government funding and support programmes for incubators, collaborate with academic institutes or other institutions through a co-investment model or deploy corporate social responsibility funds as per the seventh schedule of the Companies Act.
This comes at a time when the government is trying to increase the manufacturing sector’s share of the economy which has languished at around 15 percent for a long time.
As such, it has created production-linked incentive schemes for 14 sectors like electronics, textile, food products, high-efficiency solar PV modules, advanced chemistry cell battery, drones, and pharma with an outlay of Rs 1.97 lakh crore.
The memo shared with unicorns and corporates says that the government has "proactively recognised the importance of incubators as key pillars of the startup ecosystem and launched several initiatives to boost the incubation landscape in the country."
Line ministries and departments such as the Department for Promotion of Industry and Internal Trade (DPIIT), NITI Aayog, Ministry of Micro, Small and Medium Enterprises, Ministry of Science and Technology, Ministry of Electronics and Information Technology, Department of Agriculture and Farmers Welfare, Department of Defence Production, and the Ministry of Mines - all are running programmes to support incubators in the country.
Notwithstanding the marginal slowdown in April, the Indian manufacturing sector started the first fiscal quarter in top gear, according to the latest HSBC PMI data. While operating conditions improved at the second-fastest pace in last three-and-a-half years, supported by buoyant demand, firms experienced a sharp upturn in new business intakes, and scaled up production accordingly.
As firms geared up to increase production, they built up stocks of raw materials at the third-fastest rate since the survey began over 19 years ago.
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