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Electronics fund gives local designs a major boost

Posted: 06 Nov 2015     Print Version  Bookmark and Share

Keywords:Electronics Development Fund  Make in India  EDF  start-ups  seed funds 

Electronics and IT players should concentrate on designing products in India. This is the call of Department of Electronics and Information Technology (DeitY) Secretary JS Deepak at a symposium organised by Canbank Venture Capital Fund and Venture Intelligence. Deepak, underlining his message, cited the loss of some ₹95,541.40 crore ($15 billion) due to intellectual property (IP) rights of products sold here from other countries.

To encourage engineers and designers, the government set up the Electronics Development Fund (EDF) earlier this year. Deepak said that the EDF would help fulfil a "long-felt need" to design and manufacture electronic products here, BusinessLine reported.

The EDF aims to develop the Electronics System Design and Manufacturing (ESDM) sector to achieve "Net Zero Imports" by 2020. According to DeitY's website, setting up the fund is "one of the important strategies, which would enable creating a vibrant ecosystem of innovation, research and development (R&D) and with active industry involvement."

Dubbed as the "fund of funds," the EDF will provide risk capital to start-ups, companies and the academe to locally design and make new products in electronics, nano-electronics and IT, which will help reduce the country's dependence on imports in five years. In addition, "EDF will also help attract venture funds, angel funds and seed funds towards R&D and innovation in the specified areas."

Deepak said that this would fuel the Make in India and Digital India campaigns of the government.

Digital India aims to provide government services to citizens electronically by improving online infrastructure and by increasing Internet connectivity, while Make in India encourages multinational, as well as domestic, companies to manufacture their products in the country.

Deepak also made the call on the electronics and IT industries to "move up the value chain."

DeitY Additional Secretary Ajay Kumar said, however, that the EDF will have a "minority stake" in so-called "daughter funds" and will only participate in high-level policy direction. In other words, it is not in the scope of the EDF to choose who the beneficiaries of the fund's investment will be. The fund manager is the one tasked to determine the recipients.

Canbank Venture Capital Fund is EDF's fund manager.

Kumar expects the first investment approval to be done by December 15. Requests for seeking participation by EDF in any venture fund, angel fund or seed fund can be made until March 31, 2017.

- Stephen Padilla

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