VCs and PEs to invest $8.5 Billion in India
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VCs and PEs to invest $8.5 Billion in India
Bangalore: VCs and PEs who have been investing in the IT sector for a long time are finding heavy investment opportunities in the other sectors in India like Biotechnology, Life Sciences, Logistics, Clean Technology, Film Production and Education, states a joint paper by Assocham and Deloitte. The paper named "Indian Venture Capital - A Future Scenario" says that the decrease in the regulatory regimes in these sectors is responsible for the interest of the VCs and the PEs. "India has large opportunities in Biotechnology and Life Sciences on lines of retail and Real Estate. The Life Sciences sector in India has been attracting specialized Venture Capitalists from global and local funds. According to information received by the Assocham, U.S. based Life Sciences Fund has recently invested approximately $20 million in a Hyderabad based pharmaceutical company. Devices and diagnostics are other areas where investors are active. It is anticipated that the Biotechnology and Life Sciences will alone attract about $1.5 billion investments from VCs and PEs by 2012," said Sajjan Jindal, President, Assocham, citing the data from the paper. VCs are expected to invest more than $2 billion in India's maritime infrastructure and logistics as it strengthens cargo handling facilities to meet rising demand for exports and imports. The National Maritime Development Programme is hopeful of huge investment to upgrade India's maritime sector of which 64 percent is expected to come from VCs and PEs firms. These funds are also looking at possibilities in ancillary business that supports maritime trade such as warehousing and container freight stations. In 2007, investors committed $290 million in 11 cleantech investment deals compared to $140 million in nine deals in 2006. This is expected to continue over the coming years with the government initiatives and policy focuses. PEs and VCs are expected to make a combined investment of $3.5 billion in cleantech areas in next few years. The VCs and PEs would make huge investments includes the Indian film production and education. The Indian film industry is measured of worth $1.8 billion and is expected to grow over 25 percent, reaching over $5 billion by 2011. The current trends have made it a new venue for the VCs. The Assocham expects $0.25 billion VCs investments in next five years. Two hundred million dollar investments in the Indian education sector by taking up strategic positions in companies offering e-learning, distant learning, vocational training and the like will be the venues for the VCs. India and China continue to attract investments. The capital flowing to India is designed to expand existing companies. Venture capital in the United States, Europe and Israel is usually dedicated to of backing new technologies or services.

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