Page 2 - 201905G20Entrepreneurship Newsletter

New Farm Bill Provides New Tool for Rural Innovation

On December 21, 2018, the U.S. President Trump signed the community centers and similar institutions, but can be used more
2018 Farm Bill into law. This is a new five-year Farm Bill which broadly. The Farm Bill’s accompanying report directs USDA
contains provisions that could provide significant new tools for to include incubators, co-working spaces, makerspaces, and
rural innovations. The two greatest opportunities are the Rural “residential” entrepreneur and innovation centers. The program
Innovation Stronger Economy (RISE) grant program, which creates uses USDA’s 20,000-person definition of a rural region.
an innovation cluster and strategy program for rural regions, and Other Innovation Provisions
a change to allow the existing Community Facilities program to
support incubators, makerspaces, and job training centers. The bill contains two other noteworthy sections. First, the Rural
Business Investment Corporation authorization is extended and
RISE Grants
allows for greater participation by the Farm Credit System, which
This program would provide between $500,000 and $2 million may allow more capital to flow into these entities. A second
over four years for regional innovation initiatives in rural regions. section establishes a grant, direct loan and loan guarantee
Activities must be connected to an existing or emerging cluster program for rural broadband investments.
and could include facilitating market connections, supporting
commercialization, and providing workforce and entrepreneurship
services. The program is open to communities fitting USDA’s
broadest definition of rural, a population of 50,000 or comparable
density. The authorization extends through FY 2023.
Community Facilities Program

The USDA-RD Community Facilities program provides direct
loans, guarantees of third-party loans and grants for community
infrastructure. The program is often used for hospitals, schools,

DPIIT Proposes Startup India Vision 2024

The Commerce and Industry Ministry has proposed a host of measures such as tax incentives
to promote budding entrepreneurs as part of the 'Startup India Vision 2024'. The vision
document aims at facilitating setting up of 50,000 new start-ups in the country by 2024, and
creating 20 lakh direct and indirect employment opportunities. The Department for Promotion
of Industry and Internal Trade (DPIIT) under the ministry, which has prepared the document,
has also suggested setting up of 500 new incubators and accelerators by 2024; 100 innovation
zones in urban local bodies; deployment of entire corpus of Rs 10,000 crore Fund of Funds;
and expanding CSR funding to incubators. The other measures include setting up of Rs 1,000
crore 'India startup fund' to support high technology start-ups; providing Rs 1,000 crore of
seed funding; and operationalization of seven research parks by 2024. As part of regulatory
easing, the vision document proposes to reduce compliance burden, setting up of regulatory
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sandbox for testing of financial products; tax incentives for investments in startups; reduction of Goods and Services Tax (GST) rates; tax
exemption for ESOPs; and exemption of angel tax on all investments by Alternate Investment Funds. Further it suggested that banks
should set up a single window system to give loans to startups. The Startup India Vision 2024, a kind of upgrade of the “Startup India”
program, is expected to set off a new round of entrepreneurial boom in India.

Russia Increases Flexibility of SME Loans

The Russian government decided to lower the minimum amount of preferential loans for SMEs from 3 million rubles (about 50,000 US
dollars) to 500,000 rubles (7720 US dollars). The spokesman from Russian Ministry of Economic Development said that the current
limitation of preferential loans is from 3 million rubles to 100 million rubles ($1.5 million). Then after the adjustment, it will become from
500,000 rubles to 500 million rubles (7.7 million US dollars), which increased the flexibility of the loan and the number of recipients. The
preferential loan program was implemented on February 25, 2019, allowing SMEs to obtain loans from authorized banks at a rate not
exceeding 8.5% per year, and 69 banks have engaged in this program. The program is implemented within the framework of the National
Project on “SMEs and Entrepreneurship Initiatives”, and one of the main objectives of the project is to increase the contribution of
SMEs in GDP from the current 22.3% to 32.5%. And in the following six years, the number of people employed in the SMEs and Start-up
companies will rise up to 5.8 million.