Rs 10,000-crore Fund of Funds (FFS) scheme was set up in SIDBI by the Narendra Modi government in 2016 to be deployed over the 14th and 15th Finance Commission cycles.
Rs 10,000-crore Fund of Funds (FFS) scheme set up in SIDBI by the Narendra Modi government in 2016, to be deployed over the 14th and 15th Finance Commission cycles, has so far invested Rs 2,669.83 crore in 279 startups, according to the information shared by Commerce minister Piyush Goyal in the Lok Sabha on Wednesday. Instead of investing directly in startups, FFS contribute to the capital of SEBI-registered Alternative Investment Funds (AIF). The fund is managed by SIDBI. While so far Rs 700 crore has been released so far, SIDBI has committed Rs 3,123.20 crore to 47 AIFs while Rs 695.94 crore has been drawn from the FFS.
SIDBI in July this year had also introduced a web-based application system for contribution from FFS. The applications for contribution from different alternative investment funds are accepted online. Goyal also said that under the Startup India initiative (launched by Prime Minister Narendra Modi in January 2016) has recognised 24,921 startups as on November 21, 2019, while over 175 Innovation Hunts and programs have been hosted on the Startup India portal by different government departments and large businesses as of November 25, 2019.
Startups registered under the Startup India initiative are offered self-compliance against six labour laws and three environmental laws. According to Goyal, 169 DPIIT or Startup India recognised startups have self-certified themselves. While 15 states have incorporated self-certification for five years, 12 other states have done so for three years and remaining nine states/UTs are yet to implement it.
Importantly, the number of DPIIT-recognised startups exempted from the Angel tax has increased from 135 startups till March 29, as told earlier by a source with direct knowledge of CBDT’s notification to startups, to 1,658 startups as of November 25, 2019. The minister also announced that 247 startups have been exempted as of November 25, 2019, under Section 80-IAC of the Income Tax Act that provides for 100 per cent deduction to profits of eligible startups for three consecutive years out of seven years from the year of incorporation.