Punjab

OVERVIEW

Policy Name	Industrial & Business Development Policy 2017-2022
Website	Startup Punjab
Policy Document	Download Here
Nodal Agency	Department of Industries & Commerce, Government of Punjab
Office Address	Udyog Bhawan, Sector 17, Chandigarh 160017
Contact Details	+91 9876121633, +91 9988666952 pb@punjabinfotech.in
Eligibilty Criteria	As a Private Limited Company as per the Companies Act, 2013, a registered Partnership Firm under Section 59 of the Partnership Act of 1932 or a Limited Liability Partnership under the Limited Liability Partnership Act of 2008 in India; and Not prior to 7 years and for Biotechnology Companies, this period would be upto 10 years; and With an annual turnover that does not exceed INR 25 Crores in any preceding fiscal year; and Working towards innovation, improvement and development of products, processes and services, or if it is a scalable business model that has the high potential of wealth creation or employment generation; The entity must not be formed by the split up or reconstruction of a business already in existence and must not be created by the reconstitution or demerger of activity already in existence; The entity should not be a holding company nor a subsidiary of any firm already existing. The subsidiary of a startup would be an exception in this rule. Location: The entity/ company would be required to be registered in Punjab under the Punjab Shops and Commercial Establishment Act of 1958; Employment: The company is expected to employ at the least 50 per cent of its total qualified workforce from Punjab itself, which shall not include any contract employees.

Incentives

1 Capital Subsidy

Type of Benefit	Fiscal
Benefit Details	Government Host Institutes would be offered with a capital grant of 100% of FCI subject to a maximum of INR 1 Crores for setting up Incubators. Private Host Institutes and Stand-Alone Incubators would be offered a capital grant of 50 percent of FCI with respect to a maximum of INR 50 Lakhs for setting up Incubators.

2 Recurring Expense Reimbursement

Type of Benefit	Fiscal
Benefit Details	All approved Incubators shall get the support for recurring expenses as Operational Subsidy assistance up to the limit of INR 3 lakh per year for a period of 5 years

3 Mentoring and Training

Type of Benefit	Fiscal
Benefit Details	In order to provide mentoring for priority issues such as fundraising, scaling, recruitment and product interface, Incubators shall be provided Mentoring Assistance support up to a limit of INR 3 lakh per year for a period of 5 years

4 Startup Competition Assistance

Type of Benefit	Fiscal
Benefit Details	To encourage entrepreneurship culture in colleges, Eligible Institutes of National Importance, State Universities & Central Universities based in the State, established Incubators in these institution’s premises shall be supported by state government to organize such startup competition fest annually in which state shall provide assistance up to the limit of INR 5 lakh per event.

1 Interest Subsidy

Type of Benefit	Fiscal
Benefit Details	Eligible Startups shall be provided interest subsidy of 8% per annum for a period of 5 years on the rate of interest paid on loans obtained from scheduled banks/financial institutions subject to the maximum limit of INR 5 lakh per annum

2 Lease Rental Subsidy

Type of Benefit	Fiscal
Benefit Details	Reimbursement of 25% of lease rental subsidy to eligible Startup units established in the State, operating from Incubators/IT Parks/Industrial Clusters or any other notified location shall be eligible for a period of 1 year subject to the ceiling of INR 3 lakh per annum.

3 Seed Funding

Type of Benefit	Fiscal
Benefit Details	A Seed Grant up to INR 3 Lakh per start-up shall be provided for validation of idea, prototype development, assistance towards travelling costs and carrying out field/ market research/ skill training/ marketing and initial activities to setup a Startup etc. Seed funding to Startups would be routed through State/Centre recognized Incubators.

4 Scale up Funding

Type of Benefit

Fiscal

Benefit Details

The Government would create a corpus fund of INR 100 Cr dedicatedly for category I funding to meet the funding requirement for scalability of Startups. The salient features of the Fund would be as follows:

(a) It will have initial corpus of INR 100 Cr to be invested over a period of 5 years as the Alternative Investment Fund (AIF).

(b) The Fund would not invest directly into the Start-ups, but shall participate with capital commitment in SEBI registered Category 1 AIF Venture Funds

(c) SIDBI would be professional fund manager for managing this Fund of Fund & would empower their empanelled VCs to fund Punjab Based Startups.

(d) The mandate would be given by state government to make 10% contribution in the total corpus of the VC Fund subject to the condition that VC investstwice the amount contributed by the State Government in the Startups based in Punjab. The proportionate return or proceeds from the Venture Funds shall be remitted back to the FoF. This returns along with Capital gains shall be used to continue to fund Venture Funds to continuously support rapidly growing start-up ecosystem.

(e) The State Government in total would contribute 10 % of the funds size to be raised by VC and it shall be released only when the VC makes investment in Punjab based Startup

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