Headline: Union Budget 2025: Startup Ecosystem Reacts to the ₹10,000 Crore Fund of Funds

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Finance Minister Nirmala Sitharaman, in her record eighth Budget presentation on February 1, 2025, unveiled the Union Budget 2025, introducing an additional ₹10,000 crore to the Fund of Funds for Startups. This move aims to strengthen India’s startup ecosystem, foster entrepreneurship, and drive economic growth.

Here’s how key voices from the startup community reacted to the announcement:

Dr. Jaijit Bhattacharya ,President, Centre for Digital Economy Policy Research

The union budget 2025-26 carries forward the push towards Ease of Doing Business, while promoting Agriculture, MSME, Healthcare. There is no one large announcement but a series of critical initiatives impacting investments into the economy, both foreign and domestic. Sticking to the downward glide path of fiscal deficit and targeting 4.4%, will help keep inflation at check, while instilling further confidence in investors. The initiatives on Ease of Doing Business, especially moving towards a trust based governance, will help further unshackle up the entrepreneurial spirits of the country. Continued focus on building large industries such as Ship Building, Energy, Nuclear power etc would help lift the MSMEs and propel the economy. These are obviously multi-year initiatives but provides a good indication of the intent of the government in various sectors. Personally, I would have like to see some budgetary allocation on reducing pollution, especially air pollution. Overall, this is a budget in continuity, making life easier for people and businesses, supporting the vulnerable sections of the society and helping in building investor confidence

 

Mr. Prashant Bora, MD & CEO of OTEK (A Bora Multicorp Venture)

Prashant believes the Union Budget 2025 incentivizes the growth of the electronics industry, while offering a customer-friendly outlook, “The FM’s proposal to reduce of the customs duty on open cells and other critical electronics components to 5% will help boost the Make in India initiative. This will help electronics brands to support customers with more cost-effective pricing, leading to enhanced scalability and growth. Furthermore, the budget’s emphasis on positioning India’s aspirations to become a global electronics hub through the production-linked incentive (PLI) schemes for electronics and IT hardware manufacturing, further boosted by PM Narendra Modi’s target of $500 billion by FY30, coupled with the government’s bid to strengthen India’s startup ecosystem with an additional INR 10,000 crore Fund of Funds will be a catalyst for growth going forward.”

 

 

Dr. Deepak Kumar Sahu, Founder & Group Editor-Kalinga Digital Media

Articles by Deepak Kumar Sahu's Profile | VARINDIA Journalist | Muck Rack

India will prioritize boosting middle-class spending power, promoting inclusive development, and encouraging private investment to drive economic growth, Finance Minister Nirmala Sitharaman announced while presenting the 2025-26 Budget on Saturday. The budget also includes key measures for the poor, youth, farmers, and women, along with transformative tax reforms. One of the most significant announcements is the NIL income tax for earnings up to ₹12 lakh per annum, marking a major relief for taxpayers and strengthening financial security for the middle class.

 

 

 

Mr. Ravi Mittal, Founder and CEO of QuackQuack

Ravi believes that the Union Budget 2025-2026 takes a strong step toward strengthening India’s startup ecosystem with the additional ₹10,000 crore Fund of Funds. Access to capital remains one of the biggest obstacles for emerging businesses, and this fresh infusion of funds will provide critical support for startups to innovate, expand, and create jobs. Additionally, the new scheme for first-time women, SC, and ST entrepreneurs is a commendable move toward fostering inclusivity and diversity in the entrepreneurial landscape. At QuackQuack, we understand the challenges of building something from the ground up, and we believe such initiatives will empower more founders to take bold steps toward their dreams. This is a positive push toward making India a global hub for innovation and entrepreneurship.

 

 

Mr. Roshan Aslam, Co-founder & CEO of GoSats

Roshan believes the Union Budget 2025 offers a unique outlook for the growth of Indian startup ecosystem, as he said, “The Union Budget 2025 outlines a clearly defined future for India’s growing startup ecosystem by extending critical policies. The announcement of an additional ₹10,000 crore Fund of Funds will be a critical boost for the growth of India’s startup ecosystem in FY 25-26. As the investment limit for MSME classifications are made 2.5 times and the turnover limits doubled, this will help the financial viability of startup businesses in the country. As easier credit lines are extended to MSMEs, it will provide the essential confidence to grow and generate employment opportunities, directly contributing towards the growth of the Indian Economy.”

 

 

 

 

Ashish Agarwal – Co-Founder, Enzyme Office Spaces”      The government’s decision to infuse an additional ₹10,000 crore into the Fund of Funds underscores its unwavering commitment to India’s thriving startup ecosystem. With the existing FoF having already secured funding commitments exceeding ₹9 lakh crore, this fresh capital will ensure continued support for new-age startups, unlocking new opportunities for innovation and growth.”

Saurabh Tyagi – Co-Founder & CEO, PropChk  
“For startups actively seeking domestic funding, this expansion of the Fund of Funds is a welcome boost. The move is particularly crucial for deep-tech startups and emerging sectors, as it helps bridge a significant funding gap and fosters sustainable growth.”

Kishor Fogla – Founder, Yellow Slice  
“Private investments in cutting-edge technologies will gain momentum with this fund expansion. The extended range of funding, backed by over ₹9 lakh crore in commitments, will solidify India’s position as a global startup hub and catalyze a new wave of entrepreneurial ventures.”

Sahil Arya – Co-Founder & Director, Fat Tiger  
“The government’s focus on widening access to funding, with a substantial ₹10,000 crore infusion, reflects the evolving nature of startup financing. This shift will not only nurture the next generation of entrepreneurs but also refine funding mechanisms to better support India’s dynamic startup landscape.”

The Union Budget 2025 reinforces the government’s strategic push to make India a global startup powerhouse by enhancing access to capital, fostering innovation, and empowering entrepreneurs across diverse sectors.

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