In the first draft of the Policy Communique issued on Monday, the group has suggested policies for easy navigation of entrepreneurs across G20 nations, formulation of respective national startup policies to access each other’s markets, and making debt and venture debt products accessible to startups. It has also proposed creating and adopting a global definition framework for startups across G20 nations.
“Facilitate startups’ access to public capital markets across G20 nations by enabling cross-border listings,” the group, led by India’s Startup20 Chair, Chintan Vaishnav, said in the draft.
It has also called for enabling the creation of a Common Engagement Platform among G20 nations to promote collaboration and creating an organisation or platform with rotational leadership to promote “active collaboration” among the startup ecosystems and enable funding options.
“Create policies to incentivize corporates working with startups to co-create solutions..Develop policies to encourage startups to participate in government tenders and key projects,” it said.
The public comment period will remain open until May 27, 2023 and the final version of the Policy Communique would incorporate inputs received from stakeholders across nations.
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As per the draft, there exists “very little harmony in how startups are defined and the policies that support them are designed across nations”.Arguing that common and stronger startup definitions along with proactive policies for startups can help build better ecosystems across G20 nations, the group said: “Encourage G20 nations to formulate their respective national startup policies…Promote policies that facilitate and encourage startup-centric global trade and investment.”
A common definition of startups is crucial for uniformity in their valuation and taxation. As per the Department for Promotion of Industry and Internal Trade (DPIIT), an entity is considered a startup up to 10 years from its date of incorporation provided its turnover for any of the financial years since incorporation does not exceed Rs 100 crore. Some G20 members, including those from the European Union, define startups as entities which are less than 10 years of setup, innovate in product and business models, and aim to scale up. South Korea defines all small and medium enterprises as startups.
India has seen a 40% growth in the number of DPIIT-registered startups, about 29,000, in the past one year, taking the total registered startups to 95,000.
The Startup 20 India Communique has called for adopting key startup-specific policies, local regulations, and best practices that enable startups to smoothly access markets across G20 nations besides allocation of funds and grants specifically for sectors that require patient capital.