India on top of G-20 for entrepreneurial culture: E&Y

India on top of G-20 for entrepreneurial culture: E&Y

New Delhi: India’s entrepreneurial culture has become the strongest among G-20 nations with a substantial decline in costs and time for starting new businesses in the country, a global study by Ernst & Young said on Thursday.

Ernst & Young (E&Y) said that the report, prepared on the basis of a survey of 1,000 entrepreneurs across the G-20 nations, has substantiated India’s premier position as an emerging hub for entrepreneurial activity and innovation.

It said that 98% of the entrepreneurs surveyed believed that Indian culture encourages entrepreneurship, as compared to 80% for the rapid growth markets and 72% for the mature economies.

The study has been released ahead of a G-20 Summit in Cannes, France, to be attended by the leaders of the G-20 nations, including Prime Minister Manmohan Singh.

The G-20 is a block of the world’s 20 leading economies including the US, UK, France, Germany, Japan, China, Russia and India.

The report, released at the G-20 Young Entrepreneurs Summit in France, found that the costs of starting a business in India has declined by 5.5% since 2005.

Besides, time to start a business in India has fallen from 56.5 days in 2005 to 29 days in 2010. However, 71% of the respondents from India recommended a further simplification of procedures to start a business.

In the survey, 80% of Indian entrepreneurs reported improved access to funding, including bank loans. However, it cautions that steadily rising interest rates could weigh on lending growth in the future.

A large majority (80%) opined that funding from private equity has improved by over 500% since 2005, while about two-third of respondents (67%) said that initial public offerings have improved the access to funds.

The report also said that an active role of media and direct involvement of families have also had a strong impact in improving the perception of entrepreneurship in India in the last five years.

“We have always known India to be a hotbed of entrepreneurship, despite the hurdles in its business and regulatory environment.

“Indian entrepreneurs have made their mark both in India as also at a global level," Farokh Balsara, partner and national leader at Ernst & Young Entrepreneur of the year programme said.