Uttar Pradesh Approves Startup Policy 2026, Launches Startup Mission 2 Boost Innovation & Entrepreneurship

· Free Press Journal

Lucknow, July 6: At the Cabinet meeting chaired by Chief Minister Yogi Adityanath on Monday, approval was granted to both the Uttar Pradesh Startup Policy 2026 and the Uttar Pradesh Startup Mission. The new policy aims to promote innovation, entrepreneurship, and investment across the state, create new employment and self-employment opportunities for youth, and build a robust, inclusive, globally competitive startup ecosystem in Uttar Pradesh. The government believes that the policy will establish the state as a leading centre for innovation and entrepreneurship while playing a significant role in achieving the goal of a one trillion-dollar economy.

Minister for IT & Electronics Sunil Sharma said, "Under the new policy, the state government has made provisions for comprehensive financial and institutional support for startups from the initial stage through scaling up. The sustenance allowance has been increased from Rs 17,500 per month for one year to Rs 20,000 per month for two years. Prototype grants have been doubled from Rs 5 lakh to Rs 10 lakh, while seed funding has been increased from Rs 7.5 lakh to Rs 15 lakh. Under special circumstances, seed funding may be enhanced up to Rs 50 lakh."

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Financial incentives for startups
The new policy introduces a range of financial incentives to strengthen startups. These include reimbursement of up to Rs 2 crore for patents and quality certifications, matching grants of up to Rs 5 crore, a 4 percent interest subsidy on term loans of up to Rs 2 crore, and reimbursement of EPF and ESI contributions. These measures are expected to ease early-stage financial challenges and enable startups to scale more rapidly.

The government has decided to extend special incentives to deep-tech startups working in artificial intelligence (AI), robotics, quantum technology, space technology, and other emerging technologies. Such startups will be eligible for prototype assistance of up to Rs 20 lakh, seed funding of up to Rs 30 lakh, patience capital support of up to Rs 100 crore, and financial assistance of up to 40 percent for research and development activities.

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Support for incubators and innovation hubs
The new policy also provides enhanced support to incubators to strengthen the startup ecosystem. Capital grants for incubators have been increased from Rs 1 crore to Rs 1.25 crore, while incubators in Purvanchal and Bundelkhand will be eligible for grants of up to Rs 1.50 crore.

Operational expenditure grants have been increased from Rs 30 lakh to Rs 40 lakh per year. Additional incentives will also be provided to high-performing incubators and startups that successfully raise investments through them.

To promote cutting-edge research and innovation, the state will establish 20 new Centres of Excellence (CoEs). These centres will focus on artificial intelligence, machine learning, space technology, healthtech, agritech, robotics, and other emerging technologies.

Financial assistance for Centres of Excellence has also been increased from Rs 10 crore to Rs 12 crore. The government will establish a state-level Deep-Tech U-Hub, providing startups with an integrated platform for incubation, investment, industry collaboration, mentorship, and advanced laboratory facilities.

Ecosystem expansion and outreach
Under the new policy, business plan competitions, grand challenges, startup weeks, innovation seminars, and awareness programmes will be organised across the state to foster entrepreneurship among young people.

The government's objective is to extend the startup culture to villages and smaller towns, connecting a larger number of youth with innovation and entrepreneurship.

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Minister Sunil Sharma said, "Uttar Pradesh has made significant progress in the startup sector, with around 17,000 startups currently registered in the state. To further strengthen the ecosystem and improve coordination among startups, incubators, and Centres of Excellence, a Startup Mission Directorate will be established in Uttar Pradesh, providing greater institutional support for startup growth."

Cabinet approves Startup Mission
Lucknow: The Cabinet has also approved the establishment of the Uttar Pradesh Startup Mission. To be constituted under the Societies Registration Act, the Mission will function under the administrative control of the Department of IT & Electronics as the nodal agency for startup and innovation activities in the state. Its objective is to accelerate Uttar Pradesh's journey towards becoming a one trillion-dollar economy by 2030, promote entrepreneurship and startup culture, and strengthen incubators, innovation centres, the deep-tech ecosystem, mentorship, and acceleration programmes. The Mission will also facilitate better coordination among investors, industry, academic institutions, and startups while ensuring effective implementation, monitoring, and evaluation of various startup initiatives.

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