A CII–KPMG Thought Leadership Report has suggested that the government create exchange programmes and partnerships with nations, companies and academia to encourage start-ups to go global. The private sector can also try and partner with global universities and sponsor R&D, said the report.
There has been no dearth of capital flowing into the start-up economy, with $7.87 billion flowing in in just three quarters of 2019. Of these, 21 fund-raises were above $100 million each. Start-ups are disrupting the way old businesses worked, setting up new enterprises across industries ranging from fintech and agriech to edtech and healthtech, said the report released by Tamil Nadu Chief Minister Edappadi K Palaniswami on Friday, at the 18th edition of CII Connect 2019, a two-day international conference and exhibition on Information and Communications Technology (ICT).
Reducing digital divide
Start-ups are not only providing new solutions but also creating a new marketplace by serving the society, reducing the digital divide and helping sections of the societ which were previously struggling to be part of an inclusive financial system. All the key players of the economy should be aligned with growth of start-ups by continuous collaboration and innovation, the report said.
The transaction value for the Indian fintech sector is estimated at $33 billion in 2016. It is forecast to reach $73 billion in 2020, growing at a five-year CAGR of 22 per cent. The stakeholders involved in the sector are finding rewarding ways to ensure inclusive growth through innovative services and products in the sector, said the report.
For the Indian economy to reach the $5-trillion mark, it would need to grow at a rapid pace of 12 per cent, against the current 6 per cent, added the report.
Problem solvers
The report, which consists of two parts, also shows how some domestic start-ups are driving the economy by solving unique problems.
Given the number of regulators and corporates involved in enabling the financial network, it is essential that the infrastructure supporting it is integrated and robust, rather than operating in silos. Importance must be given to expanding financial literacy programmes to ensure larger adoption of ICT, said the report.
The report further suggested that the private sector needs to collaborate with universities and sponsor R&D. The Indian academia needs to make research an intrinsic part of its existence by allocating more funds towards scholarship and research under its various programmes. These can be furthered by participation by the private sector, the report said.
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