New Delhi: The government will establish an equity fund for start-ups with a 20% limited stake to provide further funding support to entrepreneurs around the country. Rajeev Chandrasekhar, the minister of state for information technology (IT) and electronics, announced this on Saturday.
The minister was speaking at an event held by the Confederation of Indian Industry (CII), and she mentioned Finance Minister Nirmala Sitharaman's budget announcement about the fund's creation.
"The finance minister has announced that there will be such a fund where the government will be a 20 per cent limited partner and it 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," said Mr Chandrasekhar.
Climate action, deep tech, digital economy, pharma, and agri-tech are among the crucial sunrise areas that the finance minister announced the creation of government-backed funds to stimulate.
The government has already established several funds, including the Startup India Seed Fund Scheme (SISFS), with a budget of 945 crores, to assist start-ups in meeting their financing needs.
Some governments, such as Karnataka, Uttar Pradesh, Bihar, Gujarat, and Rajasthan, have set aside funding to help new businesses get off the ground.
"It's a great time to be an entrepreneur. It is a great time to be a start-up.
"It is an absolute mission and article of faith for our prime minister and our government that the expansion of the start-up ecosystem, funding it, fuelling it, and creating innovations in the start-up ecosystem...are out there in a post-COVID-19 world in a manner where intellectual properties are created," Mr Chandrasekhar said.