Budget 2023: FM announces launch of agri accelerator fund, extends income tax benefits to March 2024 for start-ups

Finance Minister Nirmala Sitharaman announced that the government is launching an accelerator fund to boost agritech start-ups. The fund will follow a cluster-based approach, the FM said at the Union Budget 2023.

Additionally, the fund will focus on supporting young entrepreneurs from rural areas by equipping them with modern tools and technologies. She also noted that the digital public infrastructure for agriculture will be built as an open source, open standard and interoperable public good.

“This will enable inclusive, farmer-centric solutions through relevant information services for crop planning and health, improved access to farm inputs, credit, and insurance, help for crop estimation, market intelligence, and support for growth of agri-tech industry and startups,” she said.

In the Economic Survey 2023, the Finance Ministry revealed that there are over 1,000 agritech start-ups in India and more than 500 start-ups are working in the millet value chains, while the Indian Institute of Millets Research has incubated 250 start-ups under Rashtriya Krishi Vikas Yojana – Remunerative Approaches for Agriculture and Allied Sectors Rejuvenation (RKVYRAFTAAR).

The survey also highlighted that the private equity investments in agri-tech space have skyrocketed over the past four years – witnessing an increase of more than 50 per cent per annum to aggregate approximately Rs 6,600 crore.

Apart from the fund, Sitharaman also proposed to extend the date of incorporation for income tax benefits for start-ups from March 31, 2023 to March 31, 2024. The finance minister shared during the budget that this will provide the benefit of carry forward losses on change of shareholding from seven years of incorporation to 10 years.
 

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