Russian Venture Company (RVC), the largest state fund in Russia, is looking for...
Russian Venture Company (RVC), the largest state fund in Russia, is looking for investment oppurtunities in India. With plans to open a representative office in India by 2017, RVC executive director Alexander Potapov who was here recently to participate in the Smart Cities India 2016 Expo shares with Huma Siddiqui, his company’s plans and prospects of cooperation, as well as about the existing experience implementing high-tech companies to the Indian market and its interest in finding a strategic partner in India. Excerpts:
Why is RVC here?
RVC views India as a promising market with great potential. We see opportunities here for our technology companies to manufacture their products and provide services using Indian production chains. We have also noted the Indian government’s great desire to quickly overcome the country’s areas lagging behind the times; the “gaps” that have arisen between modern technological developments and the global state of these markets. Ongoing national programmes (like ‘Make in India’, ‘Start-up India’, Hundred Smart Cities, designed to develop the innovation ecosystem, including the attraction of new investments) are a good example of the seriousness of their intentions. All of this has a beneficial impact on the innovative and high-tech entrepreneurship ecosystem in India.
As a development institution, we find the Indian management experience and the implementation of support for these programmes extremely interesting.
Why is the company interested in participating in the Indian projects? What all can your company offer?
RVC has several tasks when it comes to the Indian market. Firstly, to represent the interests of Russian companies with which we work. These are, above all else, the portfolio companies of our funds, and we have 22 funds, and around 200 portfolio companies. Not all of these companies are ready to enter the global market, but there are a few dozen promising projects from different areas, which are ready for implementation in foreign markets. The pool of companies that we support include members of the TechUp Rating and companies of the National Technology Initiative (NTI) (state programme to support the development of measures in Russia for promising industries that could become the basis of the world economy over the next 20 years). These are the companies that are seeking ways to enter international markets, including those in promising regions, where they have not been present.
Secondly, the establishment of institutional connections with government agencies, those that implement national technological development programmes in India; exchange of experiences on programmes that exist here. Thirdly, we can serve as a good “entry point” for Indian partners interested in entering the Russian market.
We assist companies in feeling at home in other markets. When an Indian or Russian company enters a foreign market, it is difficult for it to “break into it”, without a local guide. Joint ventures need to be created, and one must seek out the right business and institutional or infrastructural partners. And here lies the problem; how to create these, given the “over regulation” in both India and Russia? This problem requires additional competencies, and we possess these. Companies can turn to us with questions, when they are searching for technologies in the Russian market, or seeking business partners and co-investors. We can also provide assistance in finding infrastructure partners, not necessarily just financial ones; like large industrial parks, where Indian companies can implement joint projects, and in the long-term, also implement co-production.
What is the company mandate?
The mandate of RVC is very wide, and we are not limited, either geographically or when it comes to investment stages or sectors. We can do many things, including interacting with organizations involved in exporting to Russia, for example, with the Russian Export Centre.
We look forward to working primarily with state institutions and agencies responsible for the formation and implementation of state policy in the field of innovation, as well as with Indian industrial associations uniting large and small technology companies, interesting to us in terms of interaction with private Russian companies in priority sectors. Among other things, we are interested in cooperation in the energy sphere.
In the Indian market we are hoping to establish cooperation with the ministry of new and renewable energy, the energy and resources institute, and the alliance for energy storage.
Any other areas your company would like to cooperate in India?
Another important priority is our ICT sector, including IoT, and therefore cooperation with companies such as Tata and Infosys is particularly important and interesting for us. A big umbrella partner still needs to be found, but this is not the task of the first stage, but something for the more distant future.
Your views on Russia –India bilateral trade?
Today, Russian-Indian trade cooperation leaves much to be desired. For Russia, India is in 19th place in terms of turnover, according to 2014 data, while for India – Russia is in 34th place. In 2015, this turnover was further reduced by another 20%. It is clear that not only efforts to support export-import operations are needed here, but also deeper cooperation at the institutional level, between the relevant ministries and institutions.