Kerala Finance Minister K.N. Balagopal on Tuesday said startups have a major role in strengthening the state's economy as leveraging their innovative ideas can lead to remarkable growth in various sectors.

In his address after inaugurating the ABusiness to Government (B2G) summit, organised by Kerala Startup Mission (KSUM), as a platform for startups to showcase a wide range of products and services required by the government departments and the public sector undertakings (PSUs), he said: "Startups are a vital component of the Kerala economy.

"Startups can also contribute immensely to the growth of all key sectors, including healthcare and animal husbandry."

"The government is planning to enhance the ceiling on purchase of products and services from startups. Now, startup products and services of up to Rs 20 lakh can be directly procured and those costing from Rs 20 lakh to Rs 1 crore can be procured through a limited tender process. The government is planning to increase the ceiling of limited tender from Rs 1 crore to Rs 3 crore," Balagopal added.

Citing the economic turmoil in Sri Lanka, he said the trouble faced by the island nation is a reminder of the need for developing a strong local economy since a reverse trend of globalisation is happening currently.

He pointed out that startups must learn to grow beyond their initial run of success and the government is duty bound to help startups coming up with innovative ideas. About Rs 97 crore has been set apart in the budget for startups apart from the Rs 250 crore as Venture Capital fund, he said.

KSUM is the nodal agency of the Kerala government for entrepreneurship development and incubation activities in the state.