As of October 31, 2025, a total of 6,385 recognized startups in India have been categorized as "closed," according to data from the Ministry of Corporate Affairs. This information was shared in Parliament on Tuesday, December 2nd, 2025, in a written reply to the Lok Sabha by Minister of State for Commerce and Industry Jitin Prasada. The closures include startups that have been dissolved or struck off by the Registrar of Companies.
While a significant number, the government has indicated that this figure does not represent an increasing trend in startup closures. Prasada explained that various business factors influence these closures, including the sustainability of the business model, alignment with market demands, domestic and global economic conditions, the nature of the products and services, and the ability to attract funding.
India has a substantial startup ecosystem, with 197,692 entities recognized as startups as of October 31, 2025. These recognized startups are eligible for various incentives, such as tax benefits under the Startup India initiative, managed by the Department for Promotion of Industry and Internal Trade (DPIIT).
The state with the highest number of startup closures is Maharashtra, with 1,200, followed by Karnataka (845), Delhi (737), Uttar Pradesh (598), Telangana (368), and Tamil Nadu (338). These states account for a significant portion of India's overall startup activity.
The government supports startups through various schemes under the Startup India initiative, including the Fund of Funds for Startups, the Startup India Seed Fund Scheme, and the Credit Guarantee Scheme for Startups. These schemes aim to provide funding opportunities and support across different sectors and stages of the business cycle. Eligible startups can also claim a 100% deduction on profits for three consecutive years under Section 80-IAC of the Income Tax Act 1961. As of October 31, 2025, 4,147 recognized startups have received certificates of eligibility under this section.
In a separate reply, Commerce and Industry Minister Piyush Goyal noted that recognized startups have created over 21.11 lakh direct jobs as of October 31, 2025.
