Thiruvananthapuram: The opposition Congress in Kerala on Wednesday reiterated its allegation that the Kerala government’s claims on the growth of the state’s startup ecosystem were fudged. Leader of the Opposition V D Satheesan said that the Global Startup Ecosystem Report 2024 (GSER 2024), which the CPM-led state government has repeatedly cited to claim unprecedented growth of the ecosystem, was a paid report.

The Kerala Startup Mission (KSUM), the state government’s nodal agency for the promotion of startups, refuted the allegation, saying the report was the result of independent and unbiased research by Startup Genome, a global innovation ecosystem development organisation.

Satheesan said KSUM has been a client of Startup Genome since 2021 and the agency has paid a sum of $48,000 to the organisation. “KSUM has paid Startup Genome $13,500 in 2021, $4500 in 2022, $15,000 in 2023 and $15,000 in 2024. The government is flaunting the report for which it has paid money to the firm,” Satheesan said.

The KSUM, in a clarification issued on Wednesday, said “Kerala has been a member of Startup Genome since 2021 and has given $48,000 as membership fee so far over a period of four years. Apart from Kerala, states like Tamil Nadu, Karnataka and Telangana are also members.” Startup Genome is reputed as a totally independent organisation that does not give in to any external influence or bias, KSUM added.

Satheesan reiterated the allegation that the report was made cunningly by creating comparison periods between 2019-21 and 2021-23. “2019-21 was the pandemic period when not even a small shop was opened. The period was compared with the next two years, and it was claimed that there was a growth of 254%,” Satheesan said. The Congress leader said it was like a kid who scored one mark in an exam getting four marks next time and claiming there was a 300% growth.

He said the Kerala startup ecosystem was ahead in the affordable talent category only and it meant the state has better human resources compared to other states and countries and they were ready to work for cheaper remuneration. 

The KSUM in its clarification did not mention the allegations made by the opposition. It said the “Startup Genome’s reports are monitored closely by innovation ecosystems the world over for understanding the good practices of governments, innovation agencies and startup clusters, and formulate development strategies in the light of the insights provided by them.”

Startup Genome is an organisation that worked with more than 160 economic and innovation ministries and public/private agencies in over 55 countries. 

“The credibility of the Startup Genome report on Kerala remains unassailable when it is read in conjunction with the coveted achievements made by the ecosystem. Kerala was rated as a top performer by the Centre’s ranking in 2018, 2019 and 2020. In 2022, Kerala emerged as the Best Performer State, along with Tamil Nadu and Karnataka, in the Startup Ranking Framework of the central government. The number of registered startups has also grown impressively during this period. In 2019, 594 startups were newly registered in Kerala, which steadily went up to 669 in 2020, 899 in 2021, 1,069 in 2022, 1,294 in 2023 and 1,128 in 2024, as per the government of India’s statistics. As per the Government of India’s official data, the total number of startups in Kerala now stands at 6,304. As per the KSUM data, the startups in the state received funding to the tune of Rs 826 crore during 2019-20. This steeply increased to Rs 3,880 crore during 2021-22, marking a phenomenal growth of 369 per cent,” the KSUM said.

The Kerala startup ecosystem found itself at the centre of a controversy recently as Congress Working Committee member and Thiruvananthapuram MP Shashi Tharoor praised the LDF government’s pro-business initiatives, citing the GSER report. Tharoor’s comments in a newspaper article invited the wrath of his party leadership and colleagues who said he was endorsing the government’s claims without verifying them.