Fund Of Funds For Startups Facilitated INR 18K Cr Investments By FY24: Economic Survey

SUMMARY

The government committed more than INR 10,500 Cr for AIFs under Fund of Funds For Startups scheme by the end of FY24, the Economic Survey said

Launched in 2016, the Fund of Funds for Startups scheme was aimed at providing a boost to the Indian startup ecosystem and increasing capital inflows into the space

As of November 2023, the government’s FFS had facilitated investments worth INR 17,534 Cr in 938 Indian Startups, according to a CRISIL report

The Centre committed more than INR 10,500 Cr for alternative investment funds (AIFs) under the Fund of Funds For Startups (FFS) scheme by the end of the fiscal year 2023-24 (FY24).

This translated to an investment of more than INR 18,000 Cr in startups by the end of FY24, the Economic Survey 2023-24 said.

Launched in 2016, the FFS was aimed at providing a boost to the Indian startup ecosystem and increasing capital inflows into the space.

As of November 2023, the government’s FFS had facilitated investments worth INR 17,534 Cr in 938 Indian Startups, according to a CRISIL report.

This comes at a time when the central government is planning to roll out the national deeptech policy, under which it plans to provide long-term funds to companies operating in the sector.

The government released the draft guidelines on the National Deep Tech Startup Policy (NDTSP) for public consultation in July last year. The draft envisages a minimum grant of INR 2 Cr at the proof-of-concept stage and a minimum of INR 3 Cr grant at the prototype stage.

Earlier this year, Rajesh Kumar Singh, secretary of the Department for Promotion of Industry and Internal Trade (DPIIT), said the government was in the final stages of creating a dedicated policy for deeptech startups.

In her interim budget speech, Finance Minister Nirmala Sitharaman said that a new scheme would be introduced to strengthen the deeptech sector for defence purposes.

Additionally, Sitharaman also announced a corpus of INR 1 Lakh Cr to provide 50-year interest-free loans for research and development in sunrise sectors.