Policy

Maharashtra Govt sets up financing vehicle for Dalit entrepreneurs

| | Updated on: Oct 30, 2012

Corporation to have Rs 700-cr corpus; to invest in tiny enterprises

Dalit entrepreneurs, who were waiting for initial capital to set up industrial units, have something to cheer as the Maharashtra Government has set up a finance corporation to tackle their specific needs. The corporation, a name for which has yet to be finalised, will have a corpus of about Rs 700 crore for investments in small and medium enterprises started by Dalit entrepreneurs .

Separately, attempts by the private sector to set up a Rs 500-crore venture capital fund, again for Dalit entrepreneurs, has received the requisite approvals.

In the case of the Maharashtra Government, the parameters for the corporation have already been laid out. The structure of the board is now being decided, a senior State Government official said.

Targeted funding

The finance corporation is to be set up along the lines of the State Industrial and Investment Corporation of Maharashtra Ltd and is targeting funding only to Dalit entrepreneurs, who would otherwise have been unable to go through with their business plans for lack of funds.

Prakash Ambedkar, President of the Bharatiya Republican Party Bahujan Mahasangh and Ambedkarite leader, told Business Line that due to casteism, Dalits could never create wealth and property. “Now, when they wish to raise loans from banks for their business ventures, they don’t get funds because they don’t have any collateral to offer. An exclusive corporation for the Dalits would bridge that gap,” he said.

Ambedkar, who has been consulted by the State Government on the formation of the corporation, said it has taken over 10 years for the Maharashtra Government to come up with the final plan.

“The idea gathered momentum when Sushilkumar Shinde was the Chief Minister, but later, it was pushed back. Now, it is again being revived,” he said.

The private sector is keeping pace. A Rs 500-crore venture capital fund, that is being promoted by the Pune-based Dalit Indian Chamber of Commerce and Industry (DICCI), has got the SEBI clearance.

“DICCI would be approaching a number of institutional investors and high net-worth institutional investors for building the corpus,” Chairman of DICC, Milind Kamble, said, adding that the chamber would soon be holding road shows to attract investors.

The fund would be called DICC SME fund and it would be lent to businesses in all the sectors, except real estate.

It would exclusively provide funding to persons from the schedule caste and tribes, so that they are able to enter businesses and industry in a big way, Kamble said.

Welcoming the idea of the fund for weaker sections of society, Shailesh Pathak, President, SREI Infrastructure Finance Ltd, said: “Today, we have India Inc, where economic activity is carried out in a corporate manner. But there is a much larger India Un-Inc, where business transactions are unstructured but employment and dispersal of economic benefits are much higher. Such funds will help businesses in India Un-Inc to prosper” he said.

> rahul.wadke@thehindu.co.in

Published on October 30, 2012

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