India launches new fund to drive a local startup ecosystem

India startup self-reliant
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India is preparing to give a push to local technology innovation through a newly announced Rs 95 crore startup challenge program called Chunauti or Challenge, which is in line with prime minister Narendra Modi’s vision.

Modi recently revealed that vision, dubbed as ‘Aatmanirbhar Bharat’ or ‘self-reliant India’, to bring global supply chains to India, especially for electronics and telecom products. 

The latest initiative comes at a time when India is encouraging established startups and other local companies to develop products and solutions for Indian requirements, having launched a public hackathon to develop an indigenous video conferencing (VC) solution. 

The initiative is launched in the wake of the recent ban on 59 Chinese apps which were believed to be compromising data privacy of Indian users.

The country’s Ministry for Electronics and Information Technology (MEITY) will fund startups across sectors. Under the challenge, it will invite projects around Edutech, Agritech and Fintech solutions for the masses including medical healthcare, diagnostic, preventive and psychological care among others.

The ministry is also looking for startups working on supply chain-related solutions, and solutions on remote monitoring, linguistic tools, jobs and skilling related solutions.

The government aims to identify around 300 startups working in identified areas and will help projects right from incubation until they are off the ground. 

The program aims to boost startups and software products with special focus on tier-two towns of India. The government has earmarked a budget of Rs. 95.03 crore ($12.84 million) over a period of three years for this program. 

The government will provide them with seed-funds of up to Rs 25 lakhs ($34,200) along with other facilities.

“I urge the young, talented innovators of India to come forward and avail benefits of ‘Chunauti’ challenge of the government and create new software products and app. This launch is a bold initiative under the clarion call for Aatmanirbhar Bharat given by Prime Minister Narendra Modi,” IT and Telecom Minister Ravi Shankar Prasad said during the launch of the initiative.

The startups selected through the program will be provided various support from the government through Software Technology Parks centres across India.  They will also get incubation facilities, mentorship, security testing facilities, access to venture capitalist funding, industry connect as well as advisories in legal, human resources (HR), IPR and patent matters. 

Besides seed fund of up to Rs 25 lakh, the startups will also be provided cloud credits from leading cloud service providers. 

“Startups that are in the ideation stage may be selected under the pre-incubation programme & mentored for up-to six months to evolve their business plan and solution around the proposed idea. Each intern (startup under pre-incubation) will be paid Rs. 10,000 ($136) per month up to a period of 6 months,” according to an official statement by the government.

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