Union Budget: How an ecosystem for startups may be cultivated

The 2024-25 budget needs to focus on providing a certain level of support to the HR Tech startup companies and small businesses for their growth in prospects of incentives, funding, or other forms of assistance like allocating dedicated funds for innovation grants and providing tax incentives for Research and Development in the HR technology. Additionally, creating a streamlined application for government-backed loans and fostering public-private partnerships would enhance access to capital for these start-ups.  This doesn’t end here; The 2024-25 budget must provide ways by which the regulatory process can be made simpler for startups to enter and thrive in the HR tech Space who are otherwise comparatively new to the sector. Clear and concise guidelines could be laid down to foster a regulatory environment that encourages innovation and growth.
Moreover, the implementation of streamlined application procedures for licenses and certifications could be given emphasis which would eventually offer regulatory sandboxes for experimentation and promote an open communication channel between the start-ups and regulatory bodies. It could also be noted that periodic reviews and updates of regulations would ensure that these startups can navigate the regulatory landscape with utmost ease.
Furthermore, there are certain policies listed below that can be introduced to lower compliance complexity, foster talent development, and thus support startup companies through more flexible and fiscal incentives:

Simplified Compliance Frameworks: Implementing streamlined and standardised compliance processes to reduce the administrative burden on startups, encouraging agility and efficiency.
Tax Credits for Training: Offering fiscal incentives such as tax credits for investments in employee training and development, promoting a skilled workforce within the HR tech sector.
Innovation Grants: Providing grants or subsidies specifically for HR tech startups engaged in innovative solutions, stimulating research and development.
Flexible Workforce Regulations: Introducing policies that allow for more flexible workforce structures, like remote work options and part-time arrangements, to accommodate startup dynamics.

In addition, keeping the existing labour laws intact, certain amplifications can be made considering the overall well-being of the employees.  Introducing certain provisions for flexible work hours, remote work policies, and a “right to disconnect” after working hours can help employees maintain a work-life balance.  In addition to this, introducing mandatory mental health support programs and addressing issues like burnout and stress in labour regulations acknowledges the importance of holistic employee well-being. Extending parental leave and promoting a healthy work-life balance through clear deadlines of work hours would contribute to fostering a positive and supportive work environment.
Furthermore, emphasis should be given to promoting certain cybersecurity initiatives to ensure trust and reliability in the workplace in times of digitisation where there have been numerous cases of fraud and misconduct happening across the globe.

Cybersecurity Training Subsidies: Government subsidies or tax incentives for businesses investing in cybersecurity training programs to enhance employee awareness and skills can be brought into the scheme of things.
Certification Recognition: The ‘Recognize and Reward’ policy for organizations that attain industry-recognized cybersecurity certifications, encourages a culture of compliance, and best practices could be implemented.
Public-Private Partnerships: Thirdly, the collaborations between government agencies, cybersecurity experts, and private enterprises could be fostered to share threat intelligence and best practices, enhancing overall cybersecurity resilience.
R&D Grants for Innovative Solutions: The provisions for Research and Development grants for companies working on innovative cybersecurity solutions, fostering the development of cutting-edge technologies can be brought into the mix.
Employee Cybersecurity Bonuses: Implementing bonus programs for employees who actively contribute to strengthening cybersecurity, thereby motivating the staff to engage in maintaining a secure workplace.

When we look into the broader picture of the 2024-25 budget, certain policies could be introduced to facilitate access to employee funding. Establishing a dedicated fund within the organization that employees could tap into for professional development, education, or skills training could improve the scenario. Moreover, implementing a transparent application process ensuring equal opportunities, along with encouraging the supporters to support their employees’ growth initiatives which align with the organisational goals would be a support for the startup companies.
Lastly, the focus needs to be given to fortifying the digital infrastructure that would help entrepreneurs expand their businesses. Introducing cloud-based solutions, cybersecurity measures, scalable IT Infrastructure, regular software updates, employee training, and digital compliance can help change the scenario of digital infrastructure.
As we draft the budget, the focus should be on the seeds of innovation and support we plant for startups, ensuring a thriving business environment for years to come.
The author is CEO and Co-Founder of InCruite. Views expressed in the above piece are personal and solely that of the author. They do not necessarily reflect Firstpost’s views.
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