VC funding seen touching $1 billion next year

By siliconindia staff writer   |   Thursday, 18 December 2003, 08:00 Hrs
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NEW DELHI: Riding on a buoyant economy, bullish stock market and relatively stable political climate, India is poised to corner about $750 million of venture capital in 2003 which is slated to touch about $1 billion next year.

In 2003, India will be able to corner venture capital worth $750 million as there is an overall feel-good factor. The economy is doing good, stock market is riding high and there are no immediate elections in sight, so all these are helping venture capital funds to tap the Indian market, chairman of Indian Venture Capital Association (IVCA) Saurabh Srivastava told PTI.

Over 50 per cent of this amount is slated to be bagged by IT and BPO companies, he said while adding, however, the upcoming sectors in the venture capital funding are retail, media and entertainment, biotech and pharma companies.

He said next year, $1 billion venture capital funds are expected as the good economic and political conditions were likely to prevail.

"We anticipate 50 per cent of next year's venture capital funds to go to the IT and BPO as they are the booming sectors," Srivastava said.

In 2000, India, on the back of Internet and dotcom boom, managed to attract venture capital worth $1 billion, which fell down marginally to $900 million in 2001. In 2002, it fell further to $600 million.

Srivastava said in 2002, worldwide venture capital funding declined and India was part of the sagging markets.

"In 2003, with $750 million of expected venture capital, we aim to be one of the top two countries in attracting VC funds", he said, adding the other contenders for VC money were South Korea and Australia.

In 2002, India followed South Korea in terms of attracting VC funds.

IVCA has 40 VC funds under its fold including companies like ChrysCapital, Westgridge Capital, Infinity, UTI Venture Capital and ICICI Venture Capital.

He said to encourage further VC participation, TiECon India 2003 summit, starting on December 18, would focus on entrepreneurship in India.

"Apart from the core areas of IT and telecom, this is the first time industry experts and professionals from various verticals like media, entertainment, retail, tourism, hospitality, and venture capital funding will deliberate on issues affecting business environment," he said.

It will also provide new ideas to modernise business, technology trends over the coming decade and opportunities beyond BPO, their scope, challenges and directions.

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