Tier II and Tier III cities becoming hubs for startups: NASSCOM report
New Delhi, Dec 6 (KNN) According to a latest report by NASSCOM and Zinnov, tier II and tier III cities are home to 20 percent startups in India. The study revealed that over 40 per cent of the startup incubators and accelerators are now located in non-tier I cities including Ahmedabad, Pune, Jaipur, Lucknow and Chandigarh among others
The report further said that most of the startups from tier II/III cities are advanced technology based using Artificial Intelligence, Advanced Analytics, and IoT (Internet of Things) in newer sectors such as Healthcare, Agri-tech, Education, Financial Inclusion, Energy-tech and Alternate Energy.
The tier – I and tier – II cities offer startup friendly environment by providing low cost manpower, cheaper real estate, and more affordable amenities to young companies with limited budgets. These cities are also education hubs which make them ideal for incubators and accelerators, the report observed
The report also says that in 2017 the incubators in India have grown at an impressive rate of 35 per cent as compared to 2016.
Government of India has been encouraging startups in tier-II and tier-III cities by facilitating collaboration between government, industry and institutions, and addressing start-up concerns through innovative and sustainable solutions, the report added as the probable reasons for the rise.
Also earlier a study by Instamojo revealed that the Micro, Small and Medium Enterprises (MSMEs) present in Tier-II and Tier-III cities are growing at much more faster pace than their counterparts in tier-1 cities.
Over the past year, the turnover of MSMEs in tier-I cities is more than double but those in tier-II and tier-III cities have scored 75 percent growth in their revenue, the study added
The study further said that the financial services sector have witnessed a higher growth in Tier-II cities as compared to Tier-I cities in the last quarter. (KNN/AG)