Recommendations have been made to promote the culture of startups in India, an India Startup fund of Rs.1000 crore has been proposed to set up by (DPIIT) Department for Promotion of Industry and Internal Trade, which will be used in making investments in start-ups working in priority areas- rural health care, water and waste management, clean energy solutions, cyber security and drones.
The fund proposed shall be separated from the 10,000. Crore Fund of funds for startups ( FFS), which was set up in 2016 under the Small Industries Development bank in India (SIDBI). The proposition additionally notices to incorporate new businesses working in different advances like the Internet of Things (IoT) and Artificial Intelligence (AI).
With top to the down progression of capital, the current ₹10,000 crore FFS, through SIDBI, puts resources into funding and Alternative Investment Funds (AIFs) that further invest in start-ups. These AIFs were chosen by SIDBI based on various criteria, with the essential one being that the chosen ones would contribute over half of the corpus allotted to them in SMBs.
In another and separate arrangement, the DPIIT has prescribed administrative changes aimed at promoting venture capital and angel investments, particularly from Indian investors.
The proposed changes would be notwithstanding those reported before in February, which was to permit financial specialists and business people to get breather from the so-called angel tax. The legislature expanded the exclusion limit and kept investments by listed companies of certain minimum size, capital funds and non-residents.
Not long ago, IndianWeb2.com announced that as a major aspect of ‘Startup India Vision 2024’, DPIIT has proposed unwinding in the income tax laws relating to clearance of private/residential properties and conveying forward of misfortunes so as to advance development of growing business visionaries and start-up originators, who face trouble in raising capital.
It might be reviewed that in April a year ago, DPIIT had indicated it misery to SIDBI for moderate disbusement of Startup FFS and till that time, just Rs 600 crore of these Rs 10,000 crore have been endorsed and a pitiful total of Rs 5.66 crore had achieved just to one new venture.
In February 2017, SIDBI designated Rs 110 crore from 2016 declared Rs 10,000-crore ‘funds of funds’ for new companies, to four investment reserves, to be specific Orios Venture Partners Fund II, Kae Capital, and two minimal known assets, Saha Trust and Kitven Fund III.