Uttar Pradesh Unveils Startup Policy 2026 with ₹1,000 Crore Fund

July 7, 2026

In a significant move to position the state as a leading startup destination, the Uttar Pradesh Cabinet, chaired by Chief Minister Yogi Adityanath, has approved the Startup Policy 2026 and the establishment of the Uttar Pradesh Startup Mission . The policy introduces enhanced financial incentives, a dedicated institutional framework, and a ₹1,000-crore Startup Fund to support entrepreneurs and attract private investment .

💰 Financial Incentives: Seed Funding, Sustenance Allowance, and More

The new policy substantially increases financial assistance available to startups at every stage of their lifecycle :

Sustenance Allowance: Increased from ₹17,500 per month for one year to ₹20,000 per month for two years .
Prototype Grant: Doubled from ₹5 lakh to ₹10 lakh .
Seed Funding: Increased from ₹7.5 lakh to ₹15 lakh; in special circumstances, this can go up to ₹50 lakh .
Patent & Quality Certification Reimbursement: Up to ₹2 crore .
Matching Grant: Up to ₹5 crore for startups receiving funding from national/international institutions .
Interest Subsidy: 4% subsidy on term loans of up to ₹2 crore .
Cloud Reimbursement: Up to ₹2 lakh annually for cloud services .
EPF & ESI Reimbursement: Provision for reimbursement of employer contributions .

🚀 Deep-Tech and Innovation Focus

A major highlight of the Startup Policy 2026 is its emphasis on deep-tech startups working in emerging fields such as artificial intelligence, machine learning, robotics, quantum technology, and space technology . These ventures are eligible for enhanced support :

Prototype Assistance: Up to ₹20 lakh.
Seed Funding: Up to ₹30 lakh.
Patient Capital: Up to ₹100 crore.
R&D Support: Financial assistance covering up to 40% of research and development costs .

🏢 Institutional Framework: Uttar Pradesh Startup Mission

To implement the policy effectively, the government has approved the formation of the Uttar Pradesh Startup Mission, an autonomous body that will serve as the state’s nodal implementation agency . The Mission will be headed by the Chief Secretary through its Governing Board and will be responsible for :

Implementing the startup policy and managing grants and incentives.
Coordinating with incubators, Centres of Excellence, and innovation hubs.
Operating the state’s startup portal and monitoring ecosystem performance.
Facilitating partnerships with investors, industry, academic institutions, and Alternative Investment Funds.

A multi-layered governance structure—comprising a Steering Committee, Empowered Committee, Policy Implementation Unit, and a Startup Review Committee—will streamline approvals and strengthen policy execution .

🌱 Ecosystem Strengthening: Incubators, CoEs, and U-Hubs

The policy aims to build a robust support infrastructure across the state:

20 New Centres of Excellence (CoEs): Focused on AI, healthtech, agritech, robotics, space technology, and other emerging areas . Financial assistance for each CoE has been increased from ₹10 crore to ₹12 crore .
Incubator Support: Capital grants for incubators raised to ₹1.25 crore (and ₹1.50 crore for incubators in Purvanchal and Bundelkhand), with operational grants increased to ₹40 lakh per year .
Deep-Tech U-Hub: A state-level hub providing integrated incubation, mentorship, investment, industry collaboration, and advanced laboratory facilities .
Private Investment Mobilisation: An investor network of angel investors, VCs, and HNIs is expected to mobilise approximately ₹100 crore in private investment .

🏅 Special Incentives for Inclusive Entrepreneurship

The policy includes provisions to promote inclusive growth by offering additional incentives to :

Women entrepreneurs (startups with at least 51% women shareholding get a 50% additional incentive) .
Entrepreneurs from economically weaker sections (EWS), persons with disabilities, and transgender entrepreneurs .
Startups in Purvanchal and Bundelkhand regions .
Startups in agri-tech, circular economy, rural impact, waste management, sustainability, and climate change .

📈 The Bigger Picture: UP’s Startup Ambition

Uttar Pradesh has made significant progress in its startup ecosystem, moving from the “Aspiring Leader” category in 2018 to the “Top Performer” category in the Government of India’s Startup Ranking 2025 . The state currently has around 17,000 registered startups . The Startup Policy 2026 is expected to expand the startup culture to villages and smaller towns, create new employment opportunities, and support the state’s goal of becoming a $1 trillion economy . Alongside, the Cabinet also approved the UP Data Centre Policy 2026, targeting over 2 GW of additional data centre capacity and over ₹2 lakh crore in investments .