LEGAL FRAMEWORK FOR STARTUPS IN INDIA

Abstract

The publicity of the pace of startups as a significant economic factor of development and a driver of change has resulted in the high demand of the concrete legal framework. This structure has to assist them in building and retain them in the regulations. These new ventures are gradually becoming accepted as profit generating and job generating in India and the consequent effect is the influx of more government funding to promote their activities (Hussain and Barman, 2025). This has contributed to evolving legal/regulatory law environment which has been geared towards the aspiring legal problems and opportunity that startups face especially when it comes to the conflux of difficult issues in the spheres of corporate therewith, intellectual property and taxation (Uwamusi, 2025). This dynamic model is meant to foster innovation and is expected to possess a stable system where startups grow well in an operational environment that is stable and favorable (Sudaryana et al., 2024). Therefore, effective translations of these legal and regulatory frameworks play crucial roles in allowing startups to find a strong platform of its operations and have long-term growth without struggles in trying to balance the nature of the startup (Uwamusi, 2025). In this chapter, I will examine the Indian legal framework related to startups and point out the different regulations, policies, and court interpretation applicable to the functioning of it. It will be reflective on how effective the existing legislation, such as Startup India initiative, is in terms of limited operational risks and better legal frameworks of a new business (Uwamusi, 2025). The chapter will also examine the role of the institutional aspects and entrepreneurial strategies in determining the legal structure as well as the connection between economic freedom and regulatory regime on the startup ecosystem (Khurana et al., 2020). It will also apply the contributions of incubators, accelerators, venture capital, and crowd funding to startup development in this legal framework (Lana and Pimenta, 2021) to this legal environment.