Indians incorporated 16,600 new businesses in June as pandemic abated
20 Jul 2021
Indians incorporated more than 16,600 businesses in June 2021 alone, showing a 26 per cent year-on-year jump in entrepreneurship, amidst signs that the second wave of the SARS-CoV-2 pandemic is abating.
According to data provided by the corporate affairs ministry, there has been a 16.7 per cent jump in the incorporation of businesses in June, compared to May this year. The final figures for May is likely to show a little drop.
Out of the businesses incorporated in June, 12,722 were new companies. About 3,940 were limited liability partnerships (LLPs), which is considered to be a more flexible business vehicle preferred by the service sector.
Usually, incorporation of a new business indicates investment intent along with a potential increase in economic activity, although, a host of variables could influence the actual investments into these business vehicles.
Some of the businesses may be incorporated merely for the ownership of assets.
Earlier, in April 2020, registration of new companies and LLPs had seen a sharp drop as a result of the nationwide lockdown imposed to contain the spread of the coronavirus. This trend seems to have been reversed in June.
The overall trend so far has been of robust activity in registering businesses in the first quarter of FY22 compared to a year ago.
The results also indicate that the second covid wave had a muted impact on entrepreneurship.
Considering the sales in May, the restrictions imposed in various parts of the country during the second wave had also led to a slight drop in the goods and services tax (GST) collections reported in June.
To be specific, the GST collected in June had dropped below Rs1 lakh crore after staying above that level for eight consecutive months, according to the official data of the month.