Govt To Create Start-Up Equity Fund With 20% Limited Partnership: MoS IT

Rajeev Chandrasekhar, Minister of State for Electronics and IT said the Government is going to provide additional capital support to the entrepreneurs by establishing a new equity fund for startups with a 20% limited partnership, and the entity will be managed by the private fund managers. The announcement of the above regard has already been made by Finance Minister, Nirmala Sithraman.

“The finance minister has announced that there will be such a fund where the government will be managed by private fund managers.”

“There will be a fund that will be created and sponsored by the government of course but it will be managed like any other private fund. That will create required private equity capital as an addition to what exists today,” Chandrasekhar said at an event conducted by the Confederation of Indian Industry (CII)

Our Government has put some of the funds like the Startup India Seed Fund Scheme (SISFS) that helps startups to meet the required capital by outlaying Rs. 945 crores. As of now, Finance Minister Nirmala Sithraman has announced that the government-backed funds will be encouraging creations such as deep-tech, climate action, digital economy, pharma, and agri-tech.

In recent years, Indian agritech sectors have grown in no time at all, for more than 1000 agritech startups India is home. In 2021 agritech sector startups have raised about 4684 million across 47 deals. The sector is led by company names such as Ninjacart, Gramophone, Bijak, DeHaat, Krishify, BharatAgri, Agrowave and Cropln

In the year 2020, it is witnessed more than 14% of all investments in tech startups flow to the deeptech space, the startup has been performing very well. Since 2014 over $1.6 billion has been put into deeptech sector, according to the Inc42 data. The Indian deeptech space is led by startups such as Agnikul, Bugworks, KBCils Sciences, and others

The government had allocated Rs. 1,000 crores for the funding of the Startups also Rs, 283.5 crores have to be laid aside for the SISFS according to the Union Budget of 2022.

States like Karnataka, UP, Bihar, Rajasthan, and Gujrat have placed funds to support the startups.

Department for Promotion of Industry and Internal Trade (DPIIT) is responsible for the overall industrial policies, it has been responsible for formulation and implementation of promotional and developmental measures for growth of the industrial sector, the implementation agency for SISFS will be eligible for funding of startups that are registered and recognized.

Startups that are included not more than 2 years ago can be recognized. Currently, there are 42,813 startups that have been recognized by the DPIIT.

Chandrasekhar added, “It is an absolute mission and article of faith for our Prime Minister (Narendra Modi) and our government that the expansion of the start-up ecosystem, funding it, fuelling it, and creating innovations in the startup ecosystem… are out there in a post-COVID-19 world in a manner where intellectual properties are created,”