NEW DELHI|MUMBAI: India’s startups are lobbying the government for a lifeline as they cope with an existential liquidity crisis amid a disruption of their ecosystem due to Covid-19, the national lockdown and a spiraling global market. Half of them may be forced to close if no support is forthcoming, according to one of the letters sent to the finance minister.
Startups sought loans free of interest or linked to income tax and goods and service tax (GST) refunds to meet funding needs in a March 30 letter to finance minister Nirmala Sitharaman signed by the Confederation of Indian Industry, Nasscom, Indian Private Equity and Venture Capital Association as well as leading entrepreneurs and venture capital investors. Among the 75 signatories are Kris Gopalakrishnan, Rajan Anandan, TV Mohandas Pai, Arihant Patni and Mukesh Bansal.
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The startups want public sector banks and state-controlled Small Industries Development Bank of India (Sidbi), the implementing agency of the Rs 10,000 crore Fund-of-Funds, to offer loans up to the full extent of the refunds they’re due.
“These refunds are undisputed… but are yet to get transferred to the startups due to various reasons,” said Siddarth Pai, founding partner of 3one4 Capital and a signatory to the March 30 joint letter.
Source: Economic Times
