In a boost to startups and small businesses in the Capital, the Delhi government is planning to legalise co-working spaces across the city. Even as co-working spaces do operate in the city at present, officials said they are not legally recognised. The move will plug the gap in the city’s startup ecosystem, which compels small businesses to operate from neighbouring Noida and Gurgaon, officials underlined.

In a significant push to strengthen Delhi’s startup and small business ecosystem, the city government is planning to formally legalise co-working spaces across the Capital. While such shared workspaces already operate in Delhi, they currently lack legal recognition, a gap that officials say has pushed many early-stage startups and small enterprises to shift operations to Noida and Gurugram.

The proposed framework aims to allow both government agencies and private property owners to rent or lease spaces for co-working, coaching centres and business meetings, with flexible operating hours, thereby expanding affordable, well-connected workspace options within the city, according to a report by The Indian Express.

A co-working space is a shared office space, typically used by startups instead of leasing a dedicated office. Such spaces provide shared infrastructure like plug-and-play workstations, office equipment, Wi-Fi, meeting rooms and other usual workplace services.

The property can be rented out 24*7, which will also help property owners boost their income. For instance, cafes operating during the day could lease out the space at night to be used as co-working spaces and earn additional income.

“The proposal is currently under planning. The key aim behind this project is to promote small businesses and startups. At present, startups or small businesses that are starting from scratch either have to rent office space for seven to eight hours or allow work from home. Due to a lack of space in central and well-connected locations, many such businesses move to Noida or Gurgaon,” a senior official said.

Explaining the government’s plan, the official said that if a person owns a property in a centrally connected location — for instance, a 50 square feet area with a room, washroom, wi-fi connection, pantry, a few chairs and a table — and is not earning much from it, they can rent it out as a co-working space on an hourly basis and earn without any hassle. “We have seen that many startups with small teams require space for three to four hours for team meetings, conferences and planning. They can book such spaces on an hourly basis, depending on their budget,” the official said.

Officials said the move would also help property owners earn income without going through a lengthy process of rental agreements and paperwork. “However, if they deploy any security guard or labour, they will have to register with the Labour department and ensure wages are paid as per rules,” the official underlined.

Gradually, the government is also expected to prepare a list of registered co-working spaces and make it public so that startups can easily find a suitable match for their needs, in terms of location and connectivity.

The move has drawn praise from the industry. “This is a very welcome and practical step by the Delhi government under the leadership of Chief Minister Rekha Gupta. Legalising co-working spaces and opening up vacant government and private buildings for shared workspaces addresses a real need for startups and freelancers seeking flexible, affordable workspaces. It also unlocks underused real estate across the city and signals Delhi’s strong intent to support entrepreneurship, innovation, and job creation,” Upasana Sharma, Executive Director TiE Delhi-NCR said.

Last year, the Industries Department in Delhi had released the ‘Startup Policy 2025’ with the aim of making the Capital a hub for startups. The policy also talks about co-working spaces. “The GNCTD shall provide state-of-the-art infrastructure facilities and support systems to nurture the entrepreneurial ecosystem within the NCT of Delhi. Incubation centres, fabrication labs and co-working spaces will be supported under the private model by providing capital and operational subsidies, over and above the existing subsidies provided by the Central Government, for the first five years to incubate recognised startups at subsidised rates,” the policy states.

It also underlined that the government may provide subsidies and incentives for setting up independent incubators or upgrading existing ones in a phased manner.