Monday, December 8, 2014: Electronics and IT sectors will soon receive a Rs 100,000 million fund for innovation and development, as per plans by Department of Electronics and Information Technology (DeitY). For the purpose cooperation is needed from existing venture capitalists (VC) to select which startups will be covered by this fund. Investment of up to 20 per cent needs to be done for each selected company.
A report by The Economic Times states that DeitY has also mentioned that the government pays $100 billion for electronics import currently, which needs to be reduced by increasing domestic production. With the implementation of this initiative, DeitY hopes to increase the Intellectual Property Rights (IPR) creation in India to help further developments. Recently an Internet of Things policy was drafted by the same department to promote Venture Funds of Electronic Development Fund. It was also aimed at supporting companies in relation to IoT domains like processors, sensors and other electronics.
The policy also asked to launch a program to drive more exports from IoT products and services. As per the policy, Rs 2,500 million from the EDF fund was supposed to be kept aside to provide support to startups which are based in technology field. Rs 1000 million was earmarked for grants for collaborative research programs in areas like semiconductors and electronics. If a venture fund is of $50 million, then it would also be subsidised for R&D and product development.
At the beginning of this year, Indian government received proposals of Rs 650,000 million for investment in areas like semiconductors and electronics manufacturing. In the past too, the government has partnered with NASSCOM for a startup warehouse in Bangalore so that 100 more startups get space to work along with Internet connection. In the recently drafted IoT policy, DeitY has proposed to set up incubation centres under PPP mode with NASSCOM and other players too. These centres will host startups, SMEs as well as students. Rs 1,000 million government funding has also been proposed for this project while rest of the amount will be contributed by NASSCOM and other partners.