June 7: The government has failed to implement the startup fund designed to support the startup ventures. The programme was announced by imitating the Indian startup programme introduced by the Indian government. But the Government of Nepal has failed on execution part due to lack of clear guidelines. 

In 2015, Indian Prime Minister Narendra Modi had announced a nationwide campaign to expand startup business. In order to make the campaign a success, a fund of IRs 100 billion had been set up since 2016 to promote new startups. Though the program has not given desired results, it has been quite popular in India.

After this program became popular in India, the then Finance Minister Dr Ram Sharan Mahat introduced a programme with a similar concept in the budget for the Fiscal Year 2015/16. A startup fund of Rs 500 million was set up but no guidelines were introduced for the implementation of this programme. 

Since his tenure, various new names have been given to the programme and have been included in the budget every year. Schemes of cheap interest rate were added to make it appealing but it has not been implemented yet.

This program was continued in the budget brought by the current government led by KP Sharma Oli. Startups with innovative ideas were to be provided with the grant after setting up a challenge fund, as per the announcement made by the government while setting up the fund.

The government had asked startups to submit the project proposal without preparing any draft for the implementation of the programme in the year it was launched, and about 700 applications were also received. However, none of the startups has received the grant so far. 

However, in the second year, the government changed the modality of the fund and announced that the start-ups would be provided loan at subsidized interest rate of 2 percent instead of grant. But the programme couldn't be implemented due to the confusion over what to do with the applications submitted seeking for grant in the previous year.

In the budget brought by Finance Minister Bishnu Poudel through the ordinance for the Fiscal Year 2021/22, this programme has been included again promising to provide loans at one percent interest rate instead of two percent interest rate.

The budget mentions that seed capital of Rs 2.5 million will be provided at one percent interest rate to motivate young entrepreneurs to get involved in startup businesses. The budget doesn't mention what kind of startup business it refers to. The budget brought through the ordinance will also make arrangements for registration, renewal of startup business and other services to be provided free of cost through a one-stop system.

To attract foreign investment in startup business it will form policies accordingly and a challenge fund of Rs 1 billion will be set up.

Even in the previous fiscal years, such programmes were introduced. The government urged startups to submit their proposals but it was not implemented. So the uncertainty remains if the programme will be implemented even in this year. 

Joint Secretary at the Ministry of Finance Mahesh Acharya says that this programme will be implemented without any delay. According to him, a guideline has been formulated for the implementation of this programme.

He said that the loan will be given at one percent interest rate to those who submit the proposal with innovative ideas. However he is unaware why the programme included in the budget could not be implemented in all these years. He said that the applicants who had submitted a proposal in the previous years should submit proposal again.

According to Arjun Prasad Pokhrel, Secretary of Ministry of Industry, Commerce and Supplies (MoCIS), the programme couldn't be executed as the government didn't discuss it with the Ministry of Industry before including it in the budget. He said that if the government seeks support from the MoCIS, the latter is ready to work with the government.