Union Budget 2025: FM Announces INR 10K Cr FoF For Startups

Union Budget 2025: FM Announces INR 10K Cr FoF For Startups

SUMMARY

Finance minister Nirmala Sitharaman announced a new fund of funds (FoF) for startups

This comes after the government's allocation of INR 10,000 Cr for the previous FoF for startups has been completely utilised

FM also announced a new scheme for 5 Lakh scheduled caste/tribe first-time women entrepreneurs, providing them term loans of up to INR 2 Cr

Finance minister Nirmala Sitharaman has announced a new fund of funds (FoF) for startups with a corpus of an additional INR 10,000 Cr.

“Now a new fund of funds with expanded scope and a fresh contribution of another INR 10,000 Cr will be set up,” said Sitharaman.

This comes after the government’s allocation of INR 10,000 Cr for the previous FoF for startups has been completely utilised. The minister, while presenting the Union Budget 2025, said this FoF has resulted in commitment of INR 91,000 Cr for startups.

In addition, the FM also announced a new scheme for 5 Lakh scheduled caste/tribe first-time women entrepreneurs, providing them term loans of up to INR 2 Cr.

Further to push the country’s entrepreneurial growth, online capacity building for entrepreneurship and managerial skills will also be organised.

In addition, Sitharaman said that the government will explore setting up a fund of funds for the deeptech sector to catalyse the next generation of startups. The FM also announced an allocation of INR 20,000 Cr for research and innovation initiatives of the private sector in the session today. 

It is pertinent to note that recently, former NITI Aayog CEO Amitabh Kant also called for a deeptech-focussed fund of funds (FoF) for startups amid growing investor interest in generative artificial intelligence (GenAI) in India. 

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

By the end of fiscal year FY24, the Centre committed more than INR 10,500 Cr for alternative investment funds (AIFs) under the FFS scheme. This translated to an investment of more than INR 18,000 Cr in startups by the end of FY24. 

The announcement comes at a time when the startup ecosystem emerged somewhat stronger in 2024 after the funding winter and layoff spree of the previous two years. As per Inc42, Indian tech startup funding surpassed the $12 Bn mark across 993 deals in 2024, marking a 20% increase compared to 2023. 

You have reached your limit of free stories
Become A Startup Insider With Inc42 Plus

Join our exclusive community of 10,000+ founders, investors & operators and stay ahead in india's startup & business economy.

2 YEAR PLAN
₹19999
₹7999
₹333/Month
UNLOCK 60% OFF
Cancel Anytime
1 YEAR PLAN
₹9999
₹4999
₹416/Month
UNLOCK 50% OFF
Cancel Anytime
Already A Member?
Discover Startups & Business Models

Unleash your potential by exploring unlimited articles, trackers, and playbooks. Identify the hottest startup deals, supercharge your innovation projects, and stay updated with expert curation.

Union Budget 2025: FM Announces INR 10K Cr FoF For Startups-Inc42 Media
How-To’s on Starting & Scaling Up

Empower yourself with comprehensive playbooks, expert analysis, and invaluable insights. Learn to validate ideas, acquire customers, secure funding, and navigate the journey to startup success.

Union Budget 2025: FM Announces INR 10K Cr FoF For Startups-Inc42 Media
Identify Trends & New Markets

Access 75+ in-depth reports on frontier industries. Gain exclusive market intelligence, understand market landscapes, and decode emerging trends to make informed decisions.

Union Budget 2025: FM Announces INR 10K Cr FoF For Startups-Inc42 Media
Track & Decode the Investment Landscape

Stay ahead with startup and funding trackers. Analyse investment strategies, profile successful investors, and keep track of upcoming funds, accelerators, and more.

Union Budget 2025: FM Announces INR 10K Cr FoF For Startups-Inc42 Media
Union Budget 2025: FM Announces INR 10K Cr FoF For Startups-Inc42 Media
You’re in Good company