Government Approves Establishment Of Rs 1,000 Crore Venture Capital Fund For Space Sector Startups
The Union Cabinet on Thursday approved setting up a Rs 1,000 crore venture capital fund dedicated to the space sector under the aegis of IN-SPACe. Minister Ashwini Vaishnaw announced during a cabinet briefing that the deployment period of the proposed Rs 1,000 crore VC fund is planned to be up to five years from the actual date of start of the fund operations.
"The proposed fund is expected to boost employment in the Indian space sector by supporting startups across the entire space supply chain—upstream, midstream, and downstream. It will help businesses scale, invest in R&D, and expand their workforce," said the Union Minister.
The average deployment amount could be Rs 150-250 crore per year, depending on the investment opportunities and fund requirements.
The proposed break-up financial year wise is Rs 150 crore in financial year 2025-26, Rs 250 crore for the year 2026-27, Rs 250 crore for the year 2027-28, Rs 250 crore for the year 2028-29 and Rs 100 crore for the year 2029-30.
Prime Minister Modi also shared the news on his X profile, stating, "Excellent news for the space sector!."
He further shared, "The Cabinet's decision on establishing a Venture Capital Fund dedicated to the space sector will have a phenomenal impact on the youth. It will give opportunities to several innovative minds and add momentum to our space programme."
Excellent news for the space sector!
October 24, 2024
The Cabinet's decision on establishing a Venture Capital Fund dedicated to the space sector will have a phenomenal impact on the youth. It will give opportunities to several innovative minds and add momentum to our space programme.…The indicative range of investment is proposed to be Rs 10 crore-Rs 60 crore, contingent upon the stage of the company, its growth trajectory, and its potential impact on national space capabilities. Indicative Equity Investment Range could be Growth Stage: Rs 10 crore–Rs 30 crore and Late Growth Stage: Rs 30 crore–Rs 60 crore.
The fund is strategically designed to advance India's space sector, aligning with national priorities and fostering innovation and economic growth through capital infusion, retaining companies in India and growing the space economy.
"Each investment could generate hundreds of direct jobs in fields like engineering, software development, data analysis, and manufacturing, along with thousands of indirect jobs in supply chains, logistics, and professional services," Vaishnaw said. "By fostering a strong startup ecosystem, the fund will not only create jobs but also develop a skilled workforce, driving innovation and enhancing India's global competitiveness in the space market," he further added.
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