This comes at a time when investment in the deep tech sector has been low due to the high gestation period of deep tech start-ups.
Finance Minister Nirmala Sitharaman mentioned in the Budget that the government has allocated Rs 20,000 Crore fund to drive Research and Development (R&D) by the private sector. As part of the initiative, a deep tech fund of funds will be explored by the government.
This comes at a time when investment in the deep tech sector has been low due to the high gestation period of deep tech start-ups. Speaking about the same Ajai Chowdhry, founder, HCL & Chairman, EPIC Foundation said that the addition of Rs 10,000 crore funds of funds and Rs 20,000 crore for deep tech is beneficial for start-ups seeking VC funding.
"However, there is no focus on making India a leader in electronic products and chips, crucial for strategic autonomy amid current geopolitics," he added.
India’s G20 Sherpa and former NITI Ayog CEO Amitabh Kant also talked about the importance of having a fund of funds. Speaking at an event in Delhi, he said earlier, "The government should focus on two key actions: creating a fund of funds and launching large-scale challenges that address India's critical needs. The only way to capture the market is by launching new disruptive start-ups. Only way India can raise its GDP nine times is with the help of deep-tech."
This is Finance Minister Nirmala Sitharaman's 8th Budget. Budget for the financial year 2025–26 is also the first Budget under the leadership of Prime Minister Narendra Modi's third term. A day before the Budget, the Economic Survey was tabled in the Parliament on January 31. The survey highlighted that India will grow by 6.4% in FY25. This growth will be driven by agriculture and services. The report said, "The fundamentals of the domestic economy remain robust, with a strong external account, calibrated fiscal consolidation and stable private consumption."
The survey also highlighted the surge in the IPO market. It said, "Equity-based financing has catapulted to popularity, with IPO listings growing six times between FY13 and FY24 and India being ranked first globally in terms of the number of IPO listings in FY24," the survey stated.