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Grants and government schemes for startups in India

Design IRL Editorial · Checked 8 November 2026 · For founders of Indian startups in architecture, construction, real estate and design · How we make our guides

The main central schemes are the ₹945 crore Startup India Seed Fund, paid through incubators, the ₹10,000 crore Fund of Funds 2.0, which backs venture funds rather than startups, and a credit guarantee on loans of up to ₹20 crore. Most support starts with DPIIT recognition. States add their own, such as Karnataka's ELEVATE grants of up to ₹50 lakh.

DPIIT recognition: the first step

Under the current Startup India rules, a company counts as a startup for up to 10 years from incorporation (20 for deep tech), as long as its turnover has stayed below ₹200 crore every year (₹300 crore for deep tech). Private limited companies, partnership firms, LLPs and cooperative societies can apply; a business formed by splitting up or reconstructing an existing one can't.

What changed in 2026

These limits come from a DPIIT notification of February 2026, which replaced the 2019 rules. It raised the turnover ceiling from ₹100 crore, added a deep-tech category and cooperative societies, and restricts recognised startups from investing in real estate, luxury assets or securities for the whole recognition period.

PIB reported more than 2 lakh recognised startups by December 2025, about half from Tier-II and Tier-III cities.

Central schemes

Scheme	How it works	Status (as checked)
Startup India Seed Fund Scheme (SISFS)	₹945 crore for proof of concept, prototypes, trials and market entry, paid through selected incubators	The whole corpus is committed to 215+ incubators; new money depends on each incubator's remaining allocation
Fund of Funds for Startups (FFS)	Doesn't invest in startups directly; backs SEBI-registered venture funds (AIFs) that do	The first ₹10,000 crore is fully committed; a new ₹10,000 crore Fund of Funds 2.0 was notified on 13 Apr 2026
Credit Guarantee Scheme for Startups (CGSS)	Guarantees loans that banks, NBFCs and venture-debt funds make to recognised startups	Up to ₹20 crore per borrower: 85% cover up to ₹10 crore, 75% above

For the Seed Fund, you apply through an incubator, not to the government directly; the scheme's portal lists them. We couldn't confirm the current per-startup amounts or whether applications are open on an official page, so check the portal itself.

Fund of Funds 2.0 has four parts: deep tech, smaller funds backing early-growth startups, tech-driven manufacturing, and funds open to any sector or stage. PIB says the first fund backed 140+ funds, which invested over ₹25,500 crore in 1,370+ startups.

Tax benefits

Section 80-IAC: a recognised startup can claim a 100% tax holiday on profits for 3 consecutive years in its first 10. Only private limited companies and LLPs qualify, and it needs separate certification from the Inter-Ministerial Board; recognition alone isn't enough. Budget 2025 proposed extending the incorporation deadline to 1 April 2030.
Angel tax: the tax on share premiums under Section 56(2)(viib) was abolished for all investors by Budget 2024. India Briefing gives FY 2025-26 as the year it applies from; other commentary gives FY 2024-25.

Check with a tax adviser

This is general information from published sources, not legal, tax or investment advice. Tax rules for startups changed in 2024, 2025 and 2026; confirm the current law before you rely on any of this.

State schemes: three examples

State	What's on offer	Source
Karnataka	Startup Policy 2025–30 (₹675 crore). ELEVATE grants of up to ₹50 lakh; ELEVATE NxT up to ₹1 crore for deep tech; a ₹75 crore seed fund for startups outside Bengaluru	CXOToday, Jan 2026
Kerala	Kerala Startup Mission innovation grants: ₹3 lakh (idea), ₹7 lakh (productisation), ₹10 lakh (market), ₹15 lakh (scale-up), up to ₹30 lakh for hardware R&D	KSUM (no open call shown when checked)
Maharashtra	Startup Policy 2025: a ₹500 crore Maha-Fund, and pilot work orders of up to ₹25 lakh for Maharashtra Startup Week winners; quality-testing support approved Oct 2026	Drishti IAS summary; TeamLease RegTech

Most states have their own policy; these are three we could check. Look up your state's startup portal.

Incubators that work with the built environment

IIT Madras: its incubation cell supports construction startups such as Tvasta, which 3D-prints concrete buildings.
ASHA-India centres (Ministry of Housing and Urban Affairs): set up at IIT Madras, IIT Bombay, IIT Kharagpur, IIT Roorkee and CSIR-NEIST to incubate housing technologies (reported in 2022; check their current status).
National Design Business Incubator (NDBI), at NID Ahmedabad: an 18-month programme for design startups at prototype stage or later, taking no equity (as listed by StartupGrants India).

Common questions

What government grants and schemes are there for startups in India?

The main central schemes are the Startup India Seed Fund Scheme, paid through incubators; the Fund of Funds for Startups, which backs SEBI-registered venture funds; and the Credit Guarantee Scheme for Startups. Most support starts with DPIIT recognition, and states such as Karnataka, Kerala and Maharashtra run their own grants.

Who is eligible for DPIIT startup recognition?

Under the February 2026 DPIIT rules, a company counts as a startup for up to 10 years from incorporation (20 for deep tech) if its turnover has stayed below ₹200 crore every year (₹300 crore for deep tech). Private limited companies, partnership firms, LLPs and cooperative societies can apply; a business formed by splitting up or reconstructing an existing one can't.

How do I apply for the Startup India Seed Fund Scheme?

You apply to the Startup India Seed Fund Scheme through a selected incubator, not to the government directly; the scheme's portal lists them. The ₹945 crore corpus is fully committed to 215+ incubators, so new money depends on each incubator's remaining allocation. Check the portal for current amounts and whether applications are open.

What is the Credit Guarantee Scheme for Startups?

The Credit Guarantee Scheme for Startups guarantees loans that banks, NBFCs and venture-debt funds make to DPIIT-recognised startups. Cover goes up to ₹20 crore per borrower: 85% on loans up to ₹10 crore and 75% above that.

What tax benefits do startups get in India?

Under Section 80-IAC, a recognised startup can claim a 100% tax holiday on profits for 3 consecutive years in its first 10, if it is a private limited company or LLP certified by the Inter-Ministerial Board. The angel tax on share premiums was abolished for all investors by Budget 2024. Confirm the current law with a tax adviser.

What startup grants do Indian states offer?

Karnataka's Startup Policy 2025–30 offers ELEVATE grants of up to ₹50 lakh, and up to ₹1 crore for deep tech. Kerala Startup Mission innovation grants run from ₹3 lakh at idea stage to ₹15 lakh for scale-up, and up to ₹30 lakh for hardware R&D. Maharashtra's 2025 policy includes a ₹500 crore Maha-Fund.

Sources

Schemes, amounts and investors change. Check the official page before you apply or pitch.