‘Electronics Development Fund will encourage local manufacturers’

The setting up of the Electronics Development Fund (EDF) marks the fulfilment of a long-felt need, JS Deepak, Secretary, Department of Electronics and Information Technology (DeitY), said. This will be the engine for ‘design in India’ and ties in with the ‘Digital India’ initiative of the government, he said.

He was speaking at a symposium jointly organised by Canbank Venture Capital Fund and Venture Intelligence.

The EDF will provide risk capital to industry and academia to encourage entrepreneurs to manufacture electronics locally and enable the country to reduce dependence on imports in five years, he said.

He urged the electronics and IT industry to concentrate on designing in India, citing the loss of about $15 billion lost due to (Intellectual Property) IP rights for products sold here residing abroad. He pointed to the example of Mexico, which benefited only to the tune of $8 for every $100 of export being done by the US, but for every $100 of exports by Mexico, the US was able to benefit by $40 – thanks to its holding of IPR.

He called on the IT and electronics industry to move up the value chain even as the government celebrates its presence in the lower end given the importance of jobs in the economy.

Ajay Kumar, Additional Secretary, DeitY, said the EDF will take a minority stake in ‘daughter funds’. The EDF will not participate in determining who the beneficiaries of the fund’s investment would be. Those would be determined by the fund manager (Canbank Venture Capital Fund) and the fund would work purely on professional lines with complete autonomy and the EDF would only be concerned with high level policy direction.

Kumar said the amount of corpus would be flexible and market driven. It will be scaled up or down depending on demand. He expressed the hope that the first investment approval would be done by December 15.

COMMENT NOW