Indian-American VC urges govt to reduce rules, regulations for startups

A top Indian-American venture capitalist from Silicon Valley has urged India to create a short-term inter-ministerial commission to review the rules and regulations governing the startups to facilitate them to be the next Google and Facebook of the world.

The (Indian) government should focus on reducing the compliance burden on startups and businesses, Venkatesh Shukla, the former president of TiE Silicon Valley, told PTI in a recent interview here in California.

I think the most important thing he could do is to create either a short-term commission or a committee, inter-ministerial, inter-departmental, to take a fresh look at the rules and regulations governing startups across all departments and figure out what makes sense and what is just a nuisance without adding a whole lot of value to the country, he said.

 

A seed-stage investor, Shukla is the founder and general partner of Monta Vista Capital and has a proven track record of leading companies through rapid growth in his roles in sales, marketing, and general management.

Shukla has been an advisor to the Indian government and several state governments on issues related to startups in the country.

Because as a prime minister, he communicated time and time again that startups, success of startups is very, very important to India. They create new jobs; they bring dynamism to the economy, and they generate wealth. And the reason the US has been so successful for a hundred more than a hundred years is innovation. The relative GDP of the US compared to the rest of the world has pretty much stayed constant because of generation after generation of innovation that comes out of the US, he said.

There's no reason why India could not be in that position. I believe that when it comes to innovation when it comes to smarts and intellect, Indians are second to none. Why is there no Google? Why is there no Facebook? Why is there no open AI coming out of India? It is because of their management (and regulations issues), Shukla told PTI in response to a question.

India under Prime Minister Narendra Modi-led government has made amazing progress in the digital domain, he said.

What they call in India, digital public infrastructure, which is banking, payment, documents, retention, and the fast tax that they have now for it is the same standard all over India. Just amazing. So, some of those things I see are already so far ahead. That's one area where India is so far ahead of the rest of the world, he said.

I think the next thing really should be to export that. India has done very well in exporting yoga, meditation, and vegetarianism. I think the next thing they should export is the digital public infrastructure that India has created. I think the more and more compliance thing they can digitise, that would be good, he observed.

The government should be, in terms of all startups in India that set up global operations, they have a huge motivation to move their headquarters outside of India because the compliance is needed for this dealing with foreign currencies, when you set up subsidies, abroad becomes so burdensome that people just leave, he said.

The (Indian) government should focus on reducing the compliance burden on startups and businesses. That's all. The rest of it, you see, the talent in India would take care of, Shukla said.