Expert committee makes recommendations to stop externalisation of Indian starts ups
New Delhi: A committee of experts focusing on understanding the reasons behind the externalization of Indian start-ups recently submitted its report to IFSCA.
The committee constituted by the International Financial Services Centres Authority (IFSCA) was chaired by G. Padmanabhan, Former Executive Director, of RBI.
The committee members comprised representatives from leading Venture Capital funds, Startups, Fintechs, Law firms, Tax firms, and other domain experts.
The main focus areas of the committee were directed towards understanding the reasons for shifting Indian startups outside India and suggestions to avoid externalization of startups in the future and also to persuade startups that are presently externalized to redomicile.
The committee has provided its recommendations that are critical to the development of GIFT IFSC as a global Fintech Hub, besides suggesting measures to encourage new Fintechs to have a global outlook to set up their commercial presence in GIFT IFSC.
Additionally, the committee has identified challenges and recommended measures for the development of the International Innovation Hub at GIFT IFSC.
The report has suggested various measures/ action points to be undertaken by various stakeholders including ministries, regulatory bodies and others in implementing the idea of onshoring the Indian innovation to GIFT IFSC.
The committee report offers a comprehensive comparison of India's approach to holding company setups with other leading jurisdictions like Singapore, the Netherlands, and Luxembourg, known for successfully implementing such setups.
By highlighting the manifold advantages and addressing potential challenges associated with holding company regimes, the report unveils the immense potential of reverse flipping to drive India's economic development to great heights.
The Committee has inter-alia recommended aligning the tax and regulatory laws within the IFSC with international best practices, to create an environment that actively incentivizes and supports holding company structures.
The committee has also examined in the report several push-pull factors are responsible for Indian founders flipping to overseas jurisdictions.
IBNS
Senior Staff Reporter at Northeast Herald, covering news from Tripura and Northeast India.
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