In a landmark policy shift aimed at expanding the startup ecosystem, the Government of India has announced that sole proprietors are now eligible to apply for the official Startup Recognition Certificate under the Startup India initiative. Previously restricted to entities such as private limited companies, partnerships, and LLPs, this new inclusion marks a decisive step toward recognizing and supporting individual entrepreneurs as legitimate and scalable contributors to the innovation-driven economy.

Under the revised guidelines issued by the Department for Promotion of Industry and Internal Trade (DPIIT), a sole proprietor can receive startup recognition if the business meets the standard criteria—being less than 10 years old, having an annual turnover below ₹100 crore, and working toward innovation, development, or improvement of products or services. Once approved, the sole proprietor will gain access to a host of benefits, including income tax exemptions under Section 80-IAC, easier access to government funding schemes, self-certification under labor and environment laws, and priority in public procurement through the Government eMarketplace (GeM).

To facilitate the process, the Startup India portal has been updated with a dedicated section for sole traders, allowing streamlined registration with Aadhaar and PAN-based verification. Additionally, sole proprietors will be able to download the Startup Recognition Certificate digitally and use it to avail incubator support, mentorship programs, and intellectual property assistance. Government officials noted that this policy extension reflects the administration’s commitment to inclusive entrepreneurship, especially for grassroots innovators, rural tech developers, freelancers, and service-based micro-entrepreneurs. Business associations and startup networks have welcomed the reform, seeing it as a long-overdue acknowledgment of the entrepreneurial potential of India’s self-driven individuals.