UPSC Prelims Practice Questions — How India scaled its startup industry from 2016 to 2025
Q1. Under which section of the Income Tax Act, 1961 are DPIIT-recognised eligible startups granted a 100% deduction of profits for three consecutive assessment years out of their first ten years of incorporation?
- A. Section 35AD
- B. Section 80-IAC
- C. Section 80-IBA
- D. Section 115BAB
Q2. As of 31 December 2025, approximately how many entities had been recognised as startups by the DPIIT under the Startup India initiative?
- A. About 1.17 lakh
- B. About 1.59 lakh
- C. About 2.07 lakh
- D. About 3.50 lakh
Q3. With reference to the original Fund of Funds for Startups (FFS) and the recently notified Startup India Fund of Funds 2.0, consider the following statements:
1. Both the original FFS and FoF 2.0 have a corpus of ₹10,000 crore.
2. The corpus of FoF 2.0 is to be built up across the 16th and 17th Finance Commission cycles.
3. Unlike the original FFS, under FoF 2.0 SIDBI directly subscribes to equity of DPIIT-recognised startups instead of routing investments through Alternative Investment Funds.
Which of the statements given above is/are correct?
- Both the original FFS and FoF 2.0 have a corpus of ₹10,000 crore.
- The corpus of FoF 2.0 is to be built up across the 16th and 17th Finance Commission cycles.
- Unlike the original FFS, under FoF 2.0 SIDBI directly subscribes to equity of DPIIT-recognised startups instead of routing investments through Alternative Investment Funds.
- A. 1 only
- B. 1 and 2 only
- C. 2 and 3 only
- D. 1, 2 and 3
Q4. Which of the following is the nodal department responsible for recognising startups and operationalising the Startup India initiative?
- A. Department of Economic Affairs, Ministry of Finance
- B. Ministry of Micro, Small and Medium Enterprises
- C. Department for Promotion of Industry and Internal Trade, Ministry of Commerce & Industry
- D. Ministry of Electronics and Information Technology