During a visit to the Kerala's Startup Village, India's IT minister Ravi Shankar Prasad announced that the government will set up an electronic development fund for start-ups across the country soon. Last month we reported that Indian government is planning a Rs 10,000-crore electronics development fund to support ambitious startups in attaining scale and this is a different fund from the Rs 10,000-crore venture fund announced in the Budget for startups in micro, small and medium enterprise (MSMEs).
"The central government has come up with the concept of electronic development fund with the government partnering with angel funds to fund startups in IT, electronics and manufacturing," said Prasad
Prasad added that the central government is promoting electronic manufacturing in a big way by giving many incentives to electronic clusters across the country.
"Until now, we have received investment proposals worth Rs.18,000 crore from foreign players and others in the field of electronic manufacturing. Out of this, around Rs.4,000 crore worth of projects have been approved," he said.
With regards to the incentives, he said if a state government or any other body provides 100 acres of land for setting up manufacturing units, the central government will provide a funding support of Rs.50 crore straight away. Also, for every Rs.100 invested by someone in a factory, the government will invest Rs.25, he said. This is apart from the incentives given by the state.
Earlier in July 2014, India’s finance minister Arun Jaitley announced in his maiden budget speech an INR 10,000 crore (US$1.6 billion) fund for tech startups in India and now it already been almost 6 months nothing has happened so far.
After INR 10,000 crore fund for startups, a number of organizations have eagerly come forward since then to help the government manage the fund and invest the money. But the Ministry of Micro, Small, and Medium Enterprises, which is supposed to implement the budget proposal, has yet to come out with a plan of action. And now that IT Minister has made another promise for startups in India we are yet to see course of action from government.
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