eGovWatch: Union Cabinet gives green signal to Rs 10,000 crore ‘fund of funds’ for startups

The corpus of the Rs 10,000-crore fund, which is in line with the ‘Startup India Action Plan’ would be built up over the 14th and 15th Finance Commission cycles, subject to progress of the scheme and availability of funds

The corpus of the Rs 10,000-crore fund, which is in line with the ‘Startup India Action Plan’ would be built up over the 14th and 15th Finance Commission cycles, subject to progress of the scheme and availability of funds.

The Union Cabinet has granted its approval to establish the ‘fund of funds’ for startups, which would aim to generate employment of 18 lakh people in start-ups and support these new companies. “The fund is expected to generate employment for 18 lakh persons on full deployment … A corpus of Rs 10,000 crore could potentially be the nucleus for catalysing Rs 60,000 crore of equity investment and twice as much debt investment,” according to an official statement.

“The Cabinet has approved the establishment of ‘Fund of Funds for Startups’ (FFS) at Small Industries Development Bank of India (SIDBI) for contribution to various Alternative Investment Funds (AIF), registered with SEBI which would extend funding support to startups,” it said.

The corpus of the Rs 10,000-crore fund, which is in line with the ‘Startup India Action Plan’ would be built up over the 14th and 15th Finance Commission cycles, subject to progress of the scheme and availability of funds. Any further provisions, the government said, would be made as grant assistance through gross budgetary support by DIPP.

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