India’s Bold Move to Fuel the Next Wave of Startups

India just dropped a BOMBSHELL announcement that’s set to supercharge its startup ecosystem. With a jaw-dropping $1.15 billion Fund of Funds, sweeping regulatory reforms, and a nuclear energy push, the country is doubling down on innovation and clean energy. This isn’t just another budget—it’s a POWER MOVE to cement India’s position as a global tech powerhouse.

What’s in the Fund?

Finance Minister Nirmala Sitharaman unveiled the 2025-26 federal budget, revealing a startup fund with an “expanded scope” compared to previous initiatives. While specific focus areas weren’t detailed, the fund builds on earlier programs that have already deployed over $1 billion. This isn’t just about money—it’s about creating a launchpad for the next generation of disruptors.

“The first fund done a few years ago gave a huge fillip to the Indian venture capital industry. Dozens of Indian VC funds got set up, providing risk capital to hundreds of startups. India needs domestic venture capital.”

Sanjeev Bikhchandani, Investor and Early Backer of Zomato and Policybazaar

Regulatory Reforms: Cutting Red Tape for Startups

But wait, there’s more! The government is launching a High-Level Committee for Regulatory Reforms to review non-financial sector regulations, certifications, licenses, and permissions within a year. The goal? To create a “trust-based economic governance” system that slashes compliance burdens for startups and tech companies. This is a HUGE win for founders tired of bureaucratic roadblocks.

Deep Tech and Nuclear Energy: The Future is Here

India isn’t stopping at startups. The budget also includes plans for a Deep Tech Fund of Funds to catalyze next-gen startups in advanced technologies. Plus, a $2.3 billion Nuclear Energy Mission aims to develop five indigenous small modular reactors by 2033. By 2047, India plans to achieve 100 gigawatts of nuclear energy capacity—with private sector participation enabled by amendments to the Atomic Energy Act.

Tax Breaks and Credit Guarantees: Fueling Growth

Startups got even more love with extended tax benefits. Companies incorporated before April 2030 can now claim certain deductions for five more years. For startups in 27 critical sectors, the government reduced guarantee fees to 1% and doubled their credit guarantee limit to $230,000. This is a LIFELINE for early-stage companies.

Empowering First-Time Entrepreneurs

A new scheme targeting 500,000 first-time entrepreneurs—especially women and those from scheduled castes and tribes—will provide term loans up to $24,000 over the next five years. This builds on the success of the Stand-Up India scheme, aiming to democratize access to the startup ecosystem.

Electronics Manufacturing and Fintech Innovation

To boost electronics manufacturing, the government introduced a presumptive taxation scheme for non-residents setting up facilities. And for fintech startups, the proposed “BharatTradeNet” platform promises to streamline trade documentation and financing solutions.

Why This Matters

India’s startup ecosystem is already a global force, attracting over $100 billion in the past decade from heavyweights like SoftBank, Sequoia, and Tiger Global. With over 100 unicorns, India is Silicon Valley’s last great growth market. These new measures aren’t just about funding—they’re about creating an environment where innovation THRIVES.

“We are determined to ensure that our regulations keep up with technological innovations and global policy developments.”

Nirmala Sitharaman, Finance Minister of India

The Bottom Line

India’s $1.15 billion startup fund and sweeping reforms are a MASTERCLASS in economic strategy. By betting big on innovation, clean energy, and entrepreneurship, the country is laying the groundwork for sustained growth. For startups, this is a once-in-a-generation opportunity to scale, innovate, and dominate. The future of India’s economy is being written NOW—and it’s looking BRIGHT.