HRD ministry asks institutes to reserve 1% of annual budget for startups

To create a vigorous innovation and startup ecosystem across all Higher Education Institutions (HEIs) in the country, the Ministery for Human Resource Development (MHRD) has asked them to allocate a minimum of 1% for supporting startups and innovations as part of its national guidelines.

Minimum 1% fund of the total annual budget of the institution should be allocated for funding and supporting innovation and startups related activities through the creation of separate ‘Innovation fund’, the ministry said in 40-page guidelines titled 'the National Students and Faculty Startup Policy 2019'.

As part of the guideline, HEIs would need to create pre-incubation and incubation facilities available 24 hours a day to all students of all disciplines.

Apart from promoting innovations and job creations among youth, the policy will also create a strong ecosystem to support startups in HEIs, said HRD minister Ramesh Pokhriyal while launching the startup policy framework.

The guideline further said that Investment in entrepreneurial activities should be a part of the institutional financial strategy. It allows Institutes to raise funding through sponsorships and donations and engage their alumni network for promoting Innovation & Entrepreneurship.

Students and faculty will also be allowed licensing of IPR from the institute and will be allowed to work part-time for the startups during the study. The institutes can also take 2% to 9.5% equity/ stake in the company based on the support provided.

It also asked institutes to support students, who pursue some entrepreneurial ventures and allow institutes to use institute address to register a company and not behold from sitting in exam due attendance.

The institutes can also take 2% to 9.5% equity/ stake in the company based on the support provided.

"We want large number of students and faculties to work on new way ideas and convert them into successful enterprises," said R. Subrahmanyam, Secretary (Higher Education), MHRD.

Besides the policy framework, the HRD ministry also launched the Atal Ranking of Institutions on Innovation Achievements (ARIIA) to rank all major educational institutions and universities on innovation and entrepreneurship development.

A 15-member committee prepared the framework under the chairperson professor Ashok Jhunjunwala of Indian Institute of Technology, Madras.

While the initiative seems encouraging and praiseworthy for kind of future, it shows for young India, how the student startup policy implemented across states is remain to be seen.