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TN to set up Rs 250 cr fund to assist start-ups

IANS  |  Chennai 

The government will set up a fund with a corpus of Rs 250 crore for investments in businesses, as per the new Startup and Innovation policy 2018-2023 unveiled by on Saturday.

According to the policy, the first tranche of Rs 25 crore will be allotted in the financial year 2019-2020.

Called Startup Fund of Funds, it will be managed by a professional financial agency like the

"It will be registered as an Alternative Investment Fund (AIF) under (SEBI) regulation, 2012. The fund will be invested in other SEBI registered AIFs for investment in Startups and MSMEs established in Tamil Nadu. will invest Rs 75 crore in the fund," according to the policy.

In addition, a Tamil (TNSSGF) of Rs 50 crore with an allotment of Rs five crore in the first year shall be created in partnership with financial institutions and universities for supporting early stage financing requirements of the in the form of grants to fill the gap in fund requirement for research and innovations.

The TNSSGF would also provide funding for Idea-to-PoC (Proof of Concept) stages which are pre activities.

According to the new policy, the state and central public sector undertakings (PSU) shall be encouraged to adopt incubators and channelise their corporate social responsibility (CSR) funds.

These incubators shall also serve as an innovation sandbox to solve problems faced by the state/central PSUs which, in turn, shall support with access to platform, test bed, data, handholding and others.

According to the new policy, an entity will be recognised as a start-up (a)if it is registered in Tamil Nadu under the (TANSIM),(b) if it is incorporated as a private limited company/partnership firm/limited liability partnership, (c) up to seven years from the date of its incorporation/ registration; however, in the case of in the biotechnology, (AI) and (ML) sectors, the period shall be up to 10 years from the date of its incorporation/registration, (d) if its turnover for any of the financial years since incorporation/registration has not exceeded Rs 25 crore.

According to the policy, the following entities would not fall under the start-up category -- (a) entities formed by splitting up or reconstruction of a business already in existence, (b) a subsidiary of a firm in the State, except subsidiary of a start-up itself which also qualifies as start-up and the combined entity also satisfies the start-up criteria, (c) a franchisee of an existing business in the state, (d) entities promoted or sponsored by or related to an industrial group in the state whose group turnover exceeds Rs 300 crore.

The Tamil Nadu Startup and Innovation policy, aims to provide an enabling, innovative ecosystem in the state and hopes to support emergence of at least 5,000

The policy also hopes to extend a dedicated support to at least 10 global high growth start-ups developing innovative for high social impact in sectors like sanitation, food, clean energy, healthcare, education and others.

--IANS

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(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Sat, January 19 2019. 19:54 IST
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