To provide additional capital support to entrepreneurs across the country, the government will establish a start-up investment fund that will hold a limited 20% stake. This was announced on Saturday by the Minister of State for Information Technology (IT) and Electronics, Rajeev Chandrasekhar.
The minister, who was attending an event organized by the industry body Confederation of Indian Industry (CII), referred to the budget announcement regarding the establishment of the fund by Finance Minister Nirmala Sitharaman.
“The Minister of Finance has announced that there will be such a fund where the government will be a limited 20% partner and it will be managed by private fund managers. There will be a fund that will be created and sponsored by the government although sure but it will be managed like any other private fund. This will create the necessary investment capital on top of what exists today,” Chandrasekhar said.
The Minister of Finance had announced the creation of government-backed funds to encourage important emerging sectors, such as climate action, advanced technology, digital economy, pharmaceuticals and agri-technology.
The government has already set up some of the funds like the Startup India Seed Fund Scheme (SISFS) with an outlay of Rs 945 crore to help start-ups meet their capital requirements.
Some states, including Karnataka, Uttar Pradesh, Bihar, Gujarat and Rajasthan, have set up funds to support start-ups.
“It’s a good time to be an entrepreneur. It’s a good time to be a start-up.
“It is an absolute mission and an article of faith for our Prime Minister and our government that the expansion of the start-up ecosystem, its financing, its nurturing and the creation of innovations in the start-up ecosystem ups…are out there in a post-COVID-19 world in a way where intellectual properties are created,” Chandrasekhar said.