The Ministry of Commerce and Industry has announced that a significant portion of the newly established $10,000 crore Fund of Funds Scheme (FFS) will be directed towards supporting emerging entrepreneurs in sectors such as new age technology, artificial intelligence (AI), and machine building. This initiative is part of the government's broader strategy to foster innovation and entrepreneurship in India.

In the recent Budget announcement, the government introduced this new FFS, which aims to bolster the startup ecosystem. A similar scheme was launched in 2016, which successfully catalyzed venture capital investments in various sectors. The official stated, "We are going to dedicate a substantial amount of this $10,000 crore fund primarily for new-age technology, AI, and machine building."

The 2016 scheme was designed to stimulate venture capital investments and is managed by the Small Industries Development Bank of India (SIDBI). Under this framework, SIDBI provides capital to Alternative Investment Funds (AIFs) registered with the Securities and Exchange Board of India (SEBI), which then invest in startups. The official indicated that SIDBI is also expected to oversee the management of the second scheme.

The government's commitment to nurturing a robust ecosystem for innovation and promoting startups was further solidified with the launch of the Startup India initiative on January 16, 2016. This initiative aims to create a conducive environment for startups to thrive and grow.

According to the eligibility criteria set by the government, entities recognized as 'startups' under the Startup India initiative are eligible for various tax and non tax incentives. To date, over 150,000 entities have been recognized as startups across more than 55 industries, highlighting the growing entrepreneurial landscape in the country.

This new allocation of funds is expected to significantly enhance the capabilities of startups in the AI and technology sectors, providing them with the necessary resources to innovate and compete in a rapidly evolving market. By focusing on these key areas, the government aims to position India as a global leader in technology and innovation, ultimately driving economic growth and job creation.

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