The Karnataka government has announced an ambitious initiative to strengthen the entrepreneurial ecosystem in the state by registering 100 startups under the Preferential Market Access (PMA) scheme, aimed at making the government the number one customer for these startups and encouraging state government departments and public sector entities to procure their innovative products and services.
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The second EOI for registration of startups will open on June 20, 2024 and will remain open until August 5, 2024.
About Karnataka PMA
The PMA Scheme is a strategic framework developed to foster the growth of start-ups by facilitating public procurement from them. Over the last decade, start-ups have contributed immensely to sectors as diverse as healthcare, transportation, security and education by offering novel solutions and services. Recognising the importance of fostering this ecosystem, the Karnataka Government has amended the Karnataka Public Procurement Transparency Rules, 2000 to encourage procurement from start-ups.
The Karnataka PMA Framework aims to strengthen the startup ecosystem by providing general relaxations in public procurement, value-based preferential procurement and a scheme for inclusion of startups in tenders. Key features include removal of Earnest Money Deposit (EMD) requirement for startups during the tender process and a value-based procurement model that allows limited bids up to Rs 5 lakh only to registered startups.
Target startup companies and industries
According to a MoneyControl report, nine startups were registered following the initial Expression of Interest (EoI) which took place between December 2023 and January 2024. These include:
- Tech Kshetra Infosolutions Ltd.: Online Exam Solution, AI-Based Facial Recognition.
- Trashcon Labs Inc.: Solid waste management.
- eReleGo Technologies Inc.: Digital marketing services.
- Reverse Engineering Information Security: Cybersecurity solutions.
- Hanre Solutions Co., Ltd.: Digital marketing services.
- Finamics Techno Solutions Co., Ltd.: A digital platform for financial transactions.
- Sentient Solutions Inc.: IoT-based energy services.
- Anavigo Technologies Inc.: Biodegradable sanitary napkins.
- Elpis Energy Solutions Co., Ltd.: Solar energy solutions.
According to an official notification, in 2021, the state has identified 12 sectors that will be eligible for procurement under the PMA, including healthcare, agriculture, manufacturing, clean technology, marketing, finance, human resources, energy, operations, smart cities, renewable and circular economy and other emerging technologies.
How a startup can request a PMA selection
Startups interested in participating in the PMA scheme can follow these steps:
- Create an account: Register on Startup Karnataka by filling in basic details of the applicant and the startup.
- PMA Section: Go to the Startup Portal and access the Preferred Market Access section. From the drop-down menu[優先市場アクセス]Choose.
- Understanding PMA Support: Understand all state supports under the PMA, including eligibility criteria and supports provided.
- Submit a request: Review the Government Order, visit the Partner Web Portal, and file a complaint on the Partner Web Portal for Preferential Market Access.
Once the form is submitted, the Startup Karnataka team will assess the issue and determine the required support, after which they will connect the startup with the relevant request.
Benefits and opportunities for startups
Registered startups will enjoy a host of benefits, including waiver of pre-qualification criteria such as past turnover and experience for tenders below Rs 2 million, provided they are within the last three years of incorporation. For tenders above Rs 2 million, these criteria will be reduced by 50 percent. This will provide startups with an opportunity to engage with various government departments, helping them access the Karnataka market and accelerate their growth with government support.
Additionally, the Karnataka Innovation and Technology Society (KITS) is developing an online platform called Propel that aims to accelerate the adoption of startup solutions by connecting startups with technology multinationals, GCC and GIA partners, and other organizations. Propel fosters partnerships between startups, industry, and government departments, and provides an avenue for startups to showcase their solutions directly to potential customers.
The Karnataka government’s scheme to register startups with the PMA is currently in a pilot phase. Success at this stage will determine the expansion of the program. By facilitating public procurement from startups, the government aims to create a competitive marketplace that fosters innovation and entrepreneurship. This initiative will not only provide efficient solutions to government challenges but also generate employment opportunities, contributing to the overall economic growth of the state.
Join our vibrant community of entrepreneurs
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