Startup Recognition Framework Revised

Background of the revision

Startup Recognition Framework Revised: The Startup Recognition Framework was revised to strengthen India’s innovation ecosystem and expand formal recognition to a wider range of startups. The revision aims to promote research-driven entrepreneurship, support emerging technologies, and accelerate India’s transition into a manufacturing-led economy.

The updated framework also reflects the growing diversity of startup models in India. By widening eligibility norms, the government intends to deepen startup penetration beyond metropolitan regions.

Static GK fact: India launched the Startup India Initiative in January 2016 to build a robust startup ecosystem.

Enhanced turnover threshold

One of the major changes is the increase in the turnover threshold for startup recognition. The limit has been enhanced from ₹100 crore to ₹200 crore, allowing more growth-stage startups to remain eligible.

This change ensures continuity of policy benefits during the crucial scaling phase. It also aligns recognition norms with the realities of capital-intensive innovation and manufacturing startups.

The enhanced threshold is expected to encourage long-term investment planning and product commercialization.

Introduction of Deep Tech Startups category

A dedicated Deep Tech Startups category has been introduced for entities working on cutting-edge and breakthrough technologies. These include advanced fields such as artificial intelligence, robotics, biotechnology, and semiconductor innovation.

For this category, the age limit has been extended from 10 years to 20 years from the date of incorporation. The turnover ceiling has also been raised to ₹300 crore, offering greater operational flexibility.

This move recognizes that deep technology innovation requires longer gestation periods. It also strengthens India’s ambition to emerge as a global hub for frontier technologies.

Static GK Tip: Deep tech startups typically rely on strong intellectual property and long-term R&D cycles.

Inclusion of cooperative societies

The revised framework expands eligibility by including cooperative societies as recognised startup entities. This applies to Multi-State Cooperative Societies under the Multi-State Cooperative Societies Act, 2002, and cooperatives registered under State and Union Territory laws.

This inclusion integrates grassroots entrepreneurship with the formal startup ecosystem. It also promotes inclusive innovation in agriculture, dairy, credit, and rural industries.

The move aligns with India’s cooperative-driven economic model and decentralised development goals.

Recognised startups in India

A Recognised Startup is an entity officially acknowledged by the Department for Promotion of Industry and Internal Trade (DPIIT) based on notified eligibility criteria.

Recognised startups receive several regulatory and fiscal benefits. These include exemption from submitting cash flow statements and 100% income tax exemption on profits for three consecutive years under the Income Tax Act, 1961.

As of December 2025, India has over two lakh DPIIT-recognised startups, with nearly 50% originating from Tier-II and Tier-III cities.

Static GK fact: India is among the top three startup ecosystems globally by number of startups.

Startup ecosystem support initiatives

India’s startup ecosystem is supported by multiple flagship initiatives. The Startup India Initiative provides policy facilitation and ecosystem building.

The Atal Innovation Mission promotes innovation through incubation centres and tinkering labs. Schemes like GENESIS and NIDHI focus on early-stage funding and technology-driven startups.

These initiatives complement the revised framework by ensuring financial, infrastructural, and mentoring support.

Static GK Tip: NITI Aayog acts as the policy think tank for innovation and entrepreneurship in India.

Static Usthadian Current Affairs Table

Startup Recognition Framework Revised: