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Madhya Pradesh Incubation and Startup Policy

Madhya Pradesh Incubation and Startup Policy

Madhya Pradesh Incubation and Startup Policy

Madhya Pradesh is the second largest state in India and is among the fastest growing ones with significant investments and economic growth in the past few years. The State of Madhya Pradesh has developed a robust infrastructure along with conducive policy environment and industrial growth centred which has boosted the growth of industrialisation. Realising the high potential in the manufacturing industry, this State has positioned itself as a favourable destination for high tech industries with heavy Engineering, IT, Telecommunications, ESDM, Automobiles, Textiles, Cement, Pharmaceuticals, Agro and Food Processing based industries by establishing a dedicated Industrial Cluster in various places across the State. This has increased the growth of industries and has, therefore, resulted in the higher demand for Incubation, Plug and Play facilities for upcoming entrepreneurs in the State. This article talks about the various features of the Madhya Pradesh Incubation and Startup Policy.

Vision, Mission and Objectives

Aligning with the Government of India’s vision for “Startup India”, the Government of Madhya Pradesh has envisaged the creation of a conducive, innovative and technological entrepreneurial ecosystem through the Madhya Pradesh Incubation and Startup Policy to nurture and encourage the startup culture within the State.


The central vision of Madhya Pradesh is to establish the State as a preferred destination for Startups and Incubation Centres by offering an enabling and dynamic ecosystem to support entrepreneurial culture in the State.


The key points that the mission of the Madhya Pradesh Incubation and Startup Policy are as follows:

  • To build a sustainable ecosystem for Innovation, Research and Development and Manufacturing within the State.
  • To align the State of Madhya Pradesh along with the Government initiative of “Startup India”.


The following are the objectives of the Madhya Pradesh Incubation and Startup Policy.

  • To strengthen and promote the startup culture in the State by nurturing entrepreneurial skills.
  • To encourage and promote the setting up of new Technological Business Incubation Centres as well as strengthening the existing Incubation Centres in the State.
  • To encourage and inspire the youth of the State to develop innovative ideas.
  • To promote entrepreneurship activities amongst the youth of the State to enable sustainable and inclusive socio-economic development across Madhya Pradesh.
  • To develop and promote employment opportunities for the youth in the State of Madhya Pradesh itself.

Policy Focus Areas

The Madhya Pradesh Incubation and Startup Policy has been formulated by keeping three core policy focus areas intact. These focus areas are required for a startup to flourish into an enterprise. They are as follows:

  1. The availability of “Plug and Play” Incubation Facility
  2. Funding Support and Incentives
  3. Startup Handholding

Innovative Incubation Network

  • The State Government would provide the necessary thrust for establishing Incubation Centres within various Engineering Colleges, Professional Colleges and Management Institutes across Madhya Pradesh to offer “Plug & Play” model facilities to young students and entrepreneurs.
  • Incubation Centres would be promoted to develop an Innovative Incubation Network to build a collaborative platform among the Host Institutions and Incubators. These can be used to learn the best practices and understand the requirements of startups and entrepreneurs.
  • Selected Institutes would be encouraged to host incubators in the field of discipline and expertise. An online portal would be developed to bring all the State based incubators on a single network platform.
    This network shall provide a platform to identify the National or International mentors from Industry or academia also.
  • This Incubation Network would also play a crucial role in offering a hand to startups in identifying funding support, regulatory support and assistance in legal compliance from the Government.

Venture Capitalist Network/ Angel Investors

  • The selection and identification of an Angel Investor or a Venture Capitalist play a vital role in the journey of a startup. Therefore, the State Government has encouraged statewide Angel Investor or a Venture Capitalist to form a network that can bridge the gap between startups and their early stage which required funding support.
  • This would help build a conducive and sustainable startup ecosystem in the State.
  • This Network would also play a vital role in an Accelerator for startups in the State.


The incentives offered in the MP Incubation and Startup Policy would apply to startups and incubators in the state of Madhya Pradesh up until March 2021. These startups and incubators are also entitled to other incentives under other policies or schemes of the Government of India and Madhya Pradesh. It should be noted that the incentives listed below would be in addition to the incentives provided by the Indian Government. However, it would not be possible to claim the same incentives under any other policies or schemes of the State Government.

Incentives for Incubators

The Government shall facilitate the setting up of incubators in Government Institutions as well as eligible private institutions and prominent industry associations. Selected Host Institutes as incubators would be responsible for offering primary “plug and playing” facilities to startups such as:

  • Workspace with access to computers and the Internet.
  • Everyday business, administrative and incubation facilities.
  • Training and Mentoring

State support would be offered to incubators for the initial three years, extendable to a further two years depending on the performance at the end of which incubator is expected to be self-sufficient.

Capital Assistance

  • Eligible Host Institutions would be offered a capital grant of maximum 50% for Fixed Cost Investment for setting up the incubator with a limit of INR 50 Lakhs.
  • The same limit shall be extended to existing incubators for capacity expansion subject to the capacity utilisation of the existing incubator for two years.

Operational Assistance

  • Eligible Incubators would be given the support for recurring expenses as operational assistance upto 50% of the actual costs with a limit of INR 5 Lakhs per annum.

Stamp Duty & Registration

  • Eligible Incubators would be offered 100% stamp duty and registration fee reimbursement on the purchase/ lease of land/ office space/ IT building on the commencement of their operation.

Other Incentives

  • Mentoring Assistance
  • Startup Competition Assistance

Incentives for Entrepreneurs or Startups

Entrepreneurs/ Startups running in the incubators are required to be registered as a company or under the MSMED Act before availing these incentives.

Interest Subsidy

  • Eligible startups would be offered interest subsidy of 8% per annum for three years on the rate of interest paid on loans obtained from scheduled banks/ financial institutions subject to a limit of INR 4 Lakhs per annum.

Lease Rental Subsidy

  • Reimbursement of 25% of the lease rental subsidy to startup units established in the State operating from incubators would be eligible for three years with a limit of INR 3 Lakhs per annum from the sate of rent payment to the incubator.

Patent/ Quality Promotion Subsidy

  • Cost reimbursement for the Patent/ Quality certification per unit up to a maximum of INR 2 Lakhs for Domestic and INR 5 Lakhs for International Patent/ Quality Certification upon successfully obtaining them.
  • Within the policy period of 5 years, 2 Patent/ Quality Certification in each domestic and international category would be considered.

Other Incentives

  • Startup Marketing Assistance
  • Credential Development Assistance

Policy Applicability

The Madhya Pradesh Incubation and Startup Policy would be applicable under the following domains.

  • Information Technology (IT)/ ITeS/ BPM/ Software development
  • Internet of Things (IoT)/ E-Commerce/ Mobile Technology
  • Manufacturing including ESDM/ Robotics/ 3-D Printing
  • Biochemical, Food Technology, Agriculture and Textiles
  • Healthcare, Pharmaceuticals and Agri Processing
  • Green energy/ clean technology/ water and recycling
  • Education, Social and Rural Entrepreneurship
  • Any innovative idea or technology as approved by the State Level Implementation Committee.