New Delhi: The Union Cabinet on Thursday approved the creation of a Rs 1,000 crore venture capital fund specifically for the space sector. This fund will be managed by IN-SPACe, the Indian National Space Promotion and Authorization Center.
The Union Cabinet meeting was chaired by Prime Minister Narendra Modi. Finance Minister Nirmala Sitharaman initially announced the establishment of this venture capital fund during the budget presentation earlier this year. Now, with the Cabinet’s approval, the fund is set to provide financial support to space start-ups in India.
Space programmes will gain momentum: PM Modi
The plan is to invest in approximately 30 to 35 space start-ups in two phases. In the first phase, the fund will invest between Rs 5 crore to Rs 10 crore per start-up. In the second phase, the investment will increase to between Rs 10 crore and Rs 60 crore.
Excellent news for the space sector!
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.…
— Narendra Modi (@narendramodi) October 24, 2024
In a post on X, PM Modi highlighted the potential impact of the fund on the youth and innovative minds in the country. He emphasised that this initiative will boost India’s space program and create numerous opportunities for talented people.
In a boost to infrastructure, the Union Cabinet has approved two railway projects which will boost connectivity and commerce in Andhra Pradesh, Bihar and Telangana.
— Narendra Modi (@narendramodi) October 24, 2024
What Ashwini Vaishnaw said
Ashwini Vaishnaw, the Minister of Information and Broadcasting, provided further details about the fund. He explained that it would be operated in collaboration with the Indian Space Research Organization (ISRO) to support India’s growing space economy, which is currently valued at around $8.4 billion. The goal is to increase this value to $44 billion by 2033.
Vaishnaw also said that the fund aims to address the critical need for risk capital in the space sector. Traditional lenders often hesitate to finance high-tech start-ups due to perceived risks, making this venture capital fund essential for fostering innovation in the industry.
The fund will be managed by a professional fund manager and will include a trustee, an investment committee, an advisory board, and other necessary structures, following the guidelines set by SEBI for alternative investment funds.
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