TN Startup Innovation Policy
TN Startup Innovation Policy
TN Startup Innovation Policy
Enterprises Department
CONTENTS
TABLE OF
1 TAMIL NADU VISION 2023
2 VISION
2 MISSION
3 DEFINITION
4 NODAL AGENCY
4 ACTION PLAN
14 GENERAL SUPPORT
15 EXCLUSIONS
15 IMPLEMENTATION
TAMIL NADU VISION 2023
Tamil Nadu is one of the economic power houses of India. Entrepreneurship, social
mobility, economic growth and technology innovation have defined the growth story of
the State. Today, the State has the potential to further enhance this by supporting the
knowledge and capability of individuals to create new technology-driven enterprises to
address challenges and take advantage of the opportunities present. This further
complements “Tamil Nadu Vision 2023” goal of attaining a GSDP growth at a sustained
pace of 11% per annum for the coming years.
The contribution of the State to India’s GDP is phenomenal in sectors like Automobiles,
Commercial vehicles, Auto parts, Leather products, Textiles, Software and ITeS. The
scope of the state for technical innovation and product development is ample. In terms
of infrastructure, Tamil Nadu is one of the best performing States in the country. With
the highest GER, the State is the destination for students from various States, providing the
highest number of skilled manpower and one among the best in terms of technically
qualified manpower. Tamil Nadu houses the best and renowned Incubator of the country,
namely, the IIT-Madras and many promising Incubators catering to the needs of
entrepreneurs, students and researchers for innovating new products and processes in
various fields. The State is increasingly becoming the destination for Startups in Software-
as-a-service (SaaS). Thus the State is a potential anchor for many Startups not only in Tamil
Nadu but also those thriving all over the country.
The Tamil Nadu Startup and Innovation Policy 2018-2023, aims to provide an
enabling, innovative ecosystem in the State. Implementation of the policy will enable
the State to emerge as the “Knowledge Capital” and “Innovation Hub” of the country.
It will also attract entrepreneurs and investors across the globe.
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VISION
To make Tamil Nadu a Global Innovation Hub and the most preferred
destination for Startups by 2023.
MISSION
To create, support and nurture a vibrant Startup ecosystem in Tamil
Nadu resulting in innovation and entrepreneurship driven
employment and economic growth, facilitating creation of at least
5000 Startups including 10 global high growth Startups by 2023.
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DEFINITION
5.1. START-STEP:
An aspiring entity or individual who develops an idea with a business model based
on product/process/service innovation that is potentially scalable and replicable and
generate employment and wealth.
5.2. STARTUP :
An entity working towards innovation, development or improvement of products or
processes or services, or if it is a scalable business model with a high potential of
employment generation or wealth creation.
This broad definition of startups in Tamil Nadu is intended to be inclusive and facilitating
to support entrepreneurship across the State. The policy will encourage startups from
Tamil Nadu to follow Government of India norms that define a startup to access Central
level benefits and incentives.
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NODAL AGENCY
Entrepreneurship Development and Innovation Institute(EDII) shall act as nodal agency
to promote and facilitate startups in the State. Within EDII, a mission, TANSIM, headed
by a fulltime in-charge Officer, shall be created which will function as One-Stop-Shop to
advocate and oversee policies and programmes for promoting startups.
A Tamil Nadu Startup & Innovation Council (TANSIL) with senior officers, various
stakeholders, including startups, venture funds, educational institutions, Incubators etc
to be headed by the Chief Secretary to Government of Tamil Nadu shall be constituted
to review and advice TANSIM.
ACTION PLAN
The Tamil Nadu Startup and innovation Policy shall focus on driving entrepreneurship
and innovation in the State through 5 priority actions:
Startups registered with TANSIM and located in Tamil Nadu shall be entitled to receive any
of the stated Government benefits.
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7.1. Creating conducive ecosystem for encouraging entrepreneurship and
innovations
Tamil Nadu is well endowed with science and engineering talent pool. This
indigenous intellectual capital would be strengthened and leveraged to create
entrepreneurial ventures through the following plan of action:
7.1.4.1. Existing labour laws and technical regulations will be reviewed and simplified.
7.1.4.2. Self-certification to be accepted from startups where there are no technical
regulations which need to be complied with, such as compliance with EPFO, ESIC,
Minimum Wages, Bonus, Gratuity etc.
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7.1.4.3. Third Party Certification alone will be required where technical regulations had to
be complied with such as Boilers Act, Factories Act, the Tamil Nadu Lifts Act, etc.
7.1.4.4. TANSIM will engage with the Government in policy advocacy in emerging and
disruptive areas as well as in regulatory dismantling for outdated regulations.
7.1.4.5. Suitable regulations/orders will be notified under applicable State laws and
codes to enable faster exits for startups that shut down in tandem with Government of
India notifications.
7.1.5.1. TANSIM shall identify and empanel private IP Centres to partner or engage
with startup networks, associations, co-working spaces, etc. to provide IPR guidance to
startups.
7.1.5.2. Existing IP Support Centres will also be strengthened to serve as Patent
Information Centres (PICs) and/or Intellectual Property Facilitation Centres (IPFCs).
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7.2.1 Policy research group & regulation
A Policy research group (Think tank) shall be set up to carry out research on startup eco-
system. The group will prioritize working with startups operating in disruptive areas/
technologies to access Government, institutions and other stakeholders to share required
information and encourage innovation and facilitate market & policy adoption.
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7.2.2.9. Government will encourage Technology Business Incubators with training
programmes, accelerator programmes and business facilitation services under the brand
‘incubaTNTM’.
7.2.2.10. State Government will allot land at nominal lease for duration of 99 years to
establish ‘Startup Parks’ at appropriate places by entrepreneurs/Startups including NRIs
from Tamil Diaspora.
7.2.2.11. The Government will encourage entrepreneurs by giving access to relevant
data/information for the purpose of creating apps and technologies for public-good.
7.2.3. Funding
7.2.3.1. The State will ensure adequate budget for entrepreneurship development and
startups.
7.2.3.2. The State will set up Tamil Nadu Startup Fund of Funds of INR 250 crore to be
managed by a professional financial agency such as SIDBI. It will be registered as an
Alternative Investment Fund (AIF) under SEBI regulation, 2012.The fund will be invested
in other SEBI registered AIFs for investment in Startups and MSMEs established in Tamil
Nadu. Government of Tamil Nadu will invest INR 75 crore in the fund. The first tranche
of INR 25 crore will be allotted in FY 2019-2020.
7.2.3.3. Innovative ideas shall be nurtured by special innovation programs (such as
Innovation Voucher Program).
7.2.3.4. A Tamil Nadu Startup Seed Grant Fund (TNSSGF) of Rs. 50 Crore with an
allotment of Rs. 5 Crore in the first year shall be created in partnership with Financial
Institutions and Universities for supporting early stage financing requirements of the
startups in the form of grants to fill the gap in fund requirement for research &
innovations. The TNSSGF would also provide funding for Idea-to-PoC (Proof of Concept)
stages which are pre-startup activities. This will be similar to the erstwhile Technopreneur
Promotion Programme (TePP) grant provided by DSIR and would support prototyping
and testing of innovative ideas of students/ faculty/ individuals. TANSIM shall manage
this fund, which will be governed by a professional Scientific Startup Seed Fund Board.
7.2.3.5. The TNSSGF shall also provide revolving fund up to a maximum
of Rs.50 lakh to academic institutional & private technology business
Incubators (TBI), provided the TBI mobilises fund in the ratio of 1:3
(TNSSGF: TBIs) through industry or from its own resources and the
TBI is registered as a Section 8 company and is open to public.
7.2.3.6. Efforts will also be made to attract NRI/PIO/angel
investors/Ventures and Private Equity investors to fund startups.
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7.2.4. Grants
To provide impetus for fostering innovation in academia, the Government of Tamil Nadu
aims to augment academic research and campus environment through structured
programmes and incentives to:
Students, Faculty, Innovators and Entrepreneurs.
University spin-outs
Academic and research Institutions.
Private and public sector organizations involved in entrepreneurship development.
7.3.2. To ensure that the youth of the State are Industry/ Startup ready,
the following will be supported:
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7.3.2.3. Channelize programmes/funds from Central and
State agencies/Departments.
7.3.2.4. Introduce entrepreneurship as part of curriculum in
schools and colleges (including polytechnics and ITIs) as per
AICTE policy.
7.3.2.5. Encourage Entrepreneurship Development &
Innovation Councils (ED&IC) headed by a willing and qualified
faculty member and student led Entrepreneurship cells (E-Cell) to promote startups,
entrepreneurship & innovation activities in the campuses.
7.3.2.6. Decentralize innovation by establishing fablabs/tinkering labs/maker-spaces
that will serve as a bridge between innovators and Incubators.
7.3.2.7. Introduce academic credits for students who choose entrepreneurship
related learning activity at colleges in line with AICTE policy.
7.3.2.8. Internship and apprenticeship for students in graduate courses in science,
technology or professional courses shall be introduced for a minimum period of 6
months in any industry, in one stretch or in two stretches of minimum of 3 months,
through reworking of the apprenticeship policy of the State Government.
7.3.2.9. Special grace marks and attendance relaxation shall be allowed to students,
if their project work is converted into a startup in the Incubator.
7.3.2.10. Universities and Colleges will encourage as many startups with inter-
departmental and inter-institutional participation, taking note of the fact that startup
planning and management requires inter-disciplinary skills.
7.3.2.11. A deferred placement support system will be introduced in all colleges in
consultation with industry as a measure of risk mitigation against failure of student
startups.
7.3.2.12. Students shall be allowed to undertake a maximum of 2 years as
entrepreneurship break with attachment to an Incubator, after completion of the third
year, on application to the college. This break would not be counted towards the number
of years for graduation, subject to appraisal by the Incubator along with documents of
entrepreneurship or product development.
7.3.2.13. Permit faculty to transform their/student research projects developed at
universities/colleges to become startups and also to hold equity in such startups.
7.3.2.14. Academic institutions shall promote translational / applied R & D/
Collaborative industrial R & D.
7.3.2.15. Provide training programmes for both startups as well as startup/industry
ready employees to bridge the gap between industry requirement and current curriculum.
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7.3.3. Introducing entrepreneurship competencies in schools
The mission shall aim for a minimum of 1,00,000 high skilled direct and indirect job
creation in the startup ecosystem.
7.4. Supporting social entrepreneurship for a positive social impact and inclusion
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7.4.1.3 Mission shall encourage student participation in social impact centric activities.
7.4.1.4 The Mission shall encourage rural entrepreneurship through venture funding
and support rural-based startups and Incubators.
7.4.1.5 The Mission will organise Grand Challenges on specific social, rural and
environmental problems under hackathon programme. Selected innovative solutions shall
be awarded an initial grant and follow-on funding for piloting the idea.
7.4.1.6 The Government will create a mechanism to adopt technologies/models
developed by rural/social entrepreneurs.
7.4.2 Women
7.4.3 Transgender
7.4.3.1 Promote and assist startups where the founder or co-founder is transgender.
7.4.3.2 Training and sensitization programmes on entrepreneurship for transgender
entrepreneurs.
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7.4.3.3 Support under the New Entrepreneur-cum-Enterprise Development Scheme
(NEEDs).
7.4.3.4 Priority in procurement & marketing assistance.
7.4.3.5 Startups focusing on transgender empowerment shall also be eligible for the
above support.
7.4.4 Differently-abled
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7.5.5 Support shall be extended for startup focused programmes, workshops and
internship drives organised by Incubators, educational institutions, startup
networks/communities/groups, organisations and other reputed startup ecosystem
partners.
7.5.6 An Open Innovation portal shall be set up by Mission for posting governance,
societal and industrial challenges needing innovative solutions in public domain to find
solutions. Funding support shall be given to the crowd sourced innovative solution for
further refining and development.
7.5.7 The Government will partner with leading organizations such as World Bank,
WHO etc. to fund and support projects with social impact.
7.5.8 Tamil Nadu shall also be marketed as an ideal test-bed for students, youth and
social entrepreneurs across the world to come and work on live projects in the State.
7.5.9 TANSIM will take measures to attract global talent and resources to foster
innovation and enrich the local ecosystem with events, job opportunities, courses,
exchanges, etc.
GENERAL SUPPORT
The Mission shall implement the following welfaremeasures
to encourage startups in the State:
8.1. Support for services like IPR, Legal, Auditing, Accounting etc.
through fee credits. Entrepreneur Redeeming Card shall be introduced.
8.2. Financial support shall be extended for attending trainings, tech
conferences and trade shows. Entrepreneurs recognised by the State or
Startup India will be eligible for a one-time training grant of 75% of the
training cost subject to a maximum of Rs 1 lakh for undergoing high impact
entrepreneurship training with any reputed agency of their choice.
8.3. Benefits/exemptions available under the IT/ITeS policy of Tamil Nadu
Government shall be available for all startups, investors, incubators and
research parks.
8.4. Startups will be given priority in allotment of plots in the SIDCO
industrial estates and also on concessional lease or rent.
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EXCLUSIONS
An entity in order to qualify as a startup under this policy should not have been:
10 IMPLEMENTATION
10.1. Operational guidelines and clarifications will be issued from time to time.
10.2. The performance of this policy will be reviewed by the TANSIL every six months
based on KPIs to be fixed by the council. Among other metrics, the Compass World
Ecosystem Ranking methodology would be used to benchmark cities like Chennai and
Coimbatore.
10.3. The Mission will also arrange for annual evaluation of the policy and the report
shall be placed before the State Startup and Innovation Council for review and direction.
10.4. This Policy is valid for a period of 5 years from the date of its notification or till a new
policy is formulated. However, amendments in this policy could be made with the approval
of the Cabinet without affecting the beneficiaries already covered under the policy. The
policy shall be reviewed every five years.
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Entrepreneurship Development and Innovation Institute
(An Autonomous Body of the Government of Tamil Nadu)
Parthasarathy Koil Street, SIDCO Industrial Estate,
Ekkaduthangal, Guindy, Chennai 600032,
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