Startup

Why are Indian startup founders fleeing to Dubai?

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“We are going back to the internet-boom era, where most of the tech founders or anybody who thought they could create a good product moved out.”

About three months ago, a Bengaluru-based mid-stage fintech startup’s founder was advised by his tax consultant to consider moving to Dubai on a “golden visa.” The tax consultant suggested that the move would help the entrepreneur make massive savings on tax payouts. The entrepreneur refused — for now — because he believes he needs to be in India to keep his startup running. But there are other tech founders in India who are taking this route. “Some unicorn founders in my network have applied for the golden visa. Tax advisory firms here [in India] are asking founders to move to Dubai, especially if they are close to liquidity and exits,” the entrepreneur told Rest of World, requesting anonymity, as he does not wish his investors to feel he has the option to leave India and abandon his startup.

At least half a dozen prominent Indian tech startup founders and several investors have relocated to Dubai, which is quickly turning into India’s proxy tech capital, according to several investors, lawyers, consultants, and entrepreneurs who spoke to Rest of World — all requesting anonymity. Lured by tax reliefs and a friendly policy environment, most of these individuals have emigrated using the golden visa program, which offers five- and 10-years residency to investors, entrepreneurs, researchers, medical professionals, and outstanding students, among others. Since it was launched in 2019, at least 44,000 people have moved to Dubai on a golden visa, according to government data.

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“We are going back to the internet-boom era, where most of the tech founders or anybody who thought they could create a good product moved out [of India] — they obviously thought a different country could be more conducive to creating a good startup, getting funding, and just the overall ecosystem being friendly towards them,” said Anoush Bhasin, an independent startup and tax consultant. “India is again being seen as a [place for] talent. It shouldn’t have been the case this time, but since the government hasn’t been friendly, India is again seen as an outsourcing hub.” Bhasin said at least 50 founders in the cryptocurrency and Web3 spaces have relocated to Dubai.

Source:restofworld.org | VARSHA BANSAL

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