India has notified a revised recognition framework and eligibility criteria for recognising entities as startups, aimed at strengthening the country’s innovation ecosystem and expanding support for emerging deep-technology ventures, long-term R&D-driven enterprises, and innovation-led cooperative institutions. The development confirms CNBC-TV18’s newsbreak from January 28, 2026, when the proposal under consideration was first reported.
Key revisions to the startup recognition criteria include:
1. Higher turnover threshold for startup recognition
Keeping in view the evolving startup ecosystem and the need to extend targeted benefits across different stages of the business lifecycle, the turnover limit for recognition as a startup has been increased from ₹100 crore to ₹200 crore.
2. Introduction of a ‘Deep Tech Startup’ category with expanded age and turnover limits
A new sub-category of “Deep Tech Startup” has been introduced for entities working on cutting-edge and breakthrough technologies. Core attributes of deep-tech startups have been finalised through consultations with line ministries, departments, and ecosystem stakeholders to ensure clarity, consistency, and objective identification, while reflecting the distinctive characteristics of deep-technology enterprises.
The age and turnover criteria for deep-tech startups have been significantly expanded:
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Age limit extended from 10 years to 20 years from the date of incorporation or registration
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Turnover limit enhanced to ₹300 crore, recognising the long gestation periods, high R&D intensity, and capital-intensive development cycles typical of deep-tech ventures
3. Inclusion of cooperative societies as eligible legal entities
To support innovation-driven growth at the grassroots level—particularly in agriculture, allied sectors, rural industries, and community-based enterprises—cooperative societies have been included under eligible legal entities.
Accordingly, the following categories are now eligible for startup recognition, subject to other applicable criteria:
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Multi-State Cooperative Societies registered under the Multi-State Cooperative Societies Act, 2002
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Cooperative societies registered under State and Union Territory Cooperative Acts
Commenting on the potential impact of the revised criteria, a government release noted that over the past decade, India’s startup ecosystem has shifted toward longer innovation cycles, higher capital intensity, and delayed commercialisation, especially in deep technology, manufacturing, and R&D-driven sectors. Several innovation-led enterprises, it said, currently outgrow existing age or turnover thresholds while still in critical development or validation stages, leading to premature loss of recognition and access to policy support.
The updated framework aims to expand access to startup benefits for research- and innovation-driven enterprises; support deep-tech ventures requiring extended development timelines; enable cooperatives to drive innovation in agriculture, rural development, and allied sectors; and strengthen India’s position as a global hub for high-technology and knowledge-intensive entrepreneurship. As Startup India enters its second decade, the reforms seek to create a more predictable, inclusive, and future-ready policy environment for founders, while attracting long-term patient capital into high-technology and R&D-intensive sectors.
The Startup Policy Forum (SPF) welcomed the government’s notification granting a dedicated status to deep-tech startups, extending eligibility to 20 years with a ₹300 crore turnover threshold. It described the move as recognition of deep-tech’s unique challenges—such as long gestation periods and intensive R&D—and said it was aligned with its recommendations for differentiated policy and regulatory support. The SPF added that bridging lab-to-market gaps would be critical for deep-tech scaling and termed the government’s move a step in the right direction.
The Government of India launched the Startup India initiative on January 16, 2016, to build a robust ecosystem to nurture innovation and encourage entrepreneurship through a comprehensive action plan of schemes, incentives, and regulatory reforms. Under the initiative, the Department for Promotion of Industry and Internal Trade (DPIIT) recognises eligible entities as startups in accordance with notification G.S.R. 127(E) dated February 19, 2019. Recognised startups are eligible for a range of benefits, including access to government funding schemes, regulated funding instruments and avenues, tax exemptions, and regulatory and compliance-related relief to improve ease of doing business. Since the launch of Startup India, over two lakh entities have been recognised as startups.
