The Delhi government announced the draft of its new startup policy on Tuesday to position the national capital as a global hub for innovation and entrepreneurship and make it the most preferred destination for startups. The goal is to create 5,000 startups by 2035, generate jobs and promote inclusive growth, set up incubators and accelerators with easy funding access and create the right environment for startups to grow. Mint explains what’s in it and why it matters.
What is the Delhi Startup Policy 2025 all about?
Broadly, the policy focuses on building infrastructure, offering incentives and easing regulations for startups with priority sectors ranging from hospitality, healthcare and fintech to AI, robotics and green tech. It will be valid for 10 years from the date it is notified.
After 2035, a new policy will take over, but startups will still receive the promised incentives during the transition. The government has invited feedback on the draft from entrepreneurs and other stakeholders until September 3.
What are the key proposals in the draft?
The state offers incentives, including reimbursement on co-working lease rentals (up to ₹10 lakh annually for three years), patent filings, exhibition participation and monthly operational grants of ₹2 lakh for a year.
The government of Delhi plans to establish a ₹200 crore startup venture capital fund to provide access to finance to startups in the city. A venture capital fund pools money from multiple investors to invest in startups in exchange for equity ownership.
Apart from the incentives, the policy aims to establish a governance framework consisting of a monitoring committee, startup taskforce and a nodal agency. It proposes a single-window digital portal, helpline and startup events to simplify access and develop the ecosystem.
Is this Delhi’s first attempt at a startup policy?
Delhi’s earlier initiatives included general schemes for micro, small and medium-sized enterprises (MSMEs) or support routed through incubation centres in universities. An incubation centre provides resources, mentorship and networking opportunities to help new businesses.
The Delhi cabinet approved its first formal startup policy in May 2022. The aim was to offer startups collateral-free loans that would be interest-free for up to a year, a ₹50 crore seed fund, similar support around rental reimbursements, and aid for filing patents, among other things.
However, most of the policy’s provisions didn’t materialise due to implementation delays and the disruption caused by the covid-19 pandemic. The new policy draft is a follow-up to the earlier effort.
Do other states have a dedicated startup policy?
States including Karnataka, Telangana, Kerala and Gujarat have established startup policies with varied focus areas. Karnataka, among the earliest states to announce a startup policy, has a strong focus on IT, deeptech and R&D-driven startups.
Gujarat’s policy is focussed on – but not limited to – manufacturing startups and MSMEs, providing them with capital subsidies, patent cost reimbursement and market access support. These states have built mature ecosystems over the past decade, each playing to its strengths.
Why does it matter?
Delhi has a large concentration of startups, making the city one of the biggest and most active startup innovation hubs in the country. As of January, India had over 161,000 startups recognised by the department for promotion of industry and internal trade.
Maharashtra leads the state rankings with over 28,500 startups, while Karnataka and Delhi follow with over 16,000 startups each. Delhi has produced household names such as Zomato and Policybazaar but much of this growth has been market-driven, with relatively little structured policy support.
A dedicated policy could address gaps in funding access, infrastructure and regulatory support. It may also help attract investors, talent and global partnerships.