The Union government has proposed to constitute an expert committee to examine and suggest measures to promote venture capital (VC) and private equity (PE) investments.
Finance Minister Nirmala Sitharaman said VC and PE investors invested over Rs 5.5 lakh crore last year, facilitating one of the largest start-up and growth ecosystems.
“Increasing this investment requires a holistic inquiry into regulatory and other frictions. An expert committee will be constituted to examine and suggest appropriate measures,” she said in her budget speech.
Nagananda Doraswamy, Founder and Managing Partner, IdeaSpring Capital, said the committee would help resolve issues of coordination between multiple agencies and departments such as RBI, SEBI, Ministry of Finance, DPIIT and Ministry of Commerce.
“The combined value that Indian start-ups have generated so far is over $400 billion and is expected to reach $1 trillion by 2025. Hence the ecosystem as a sector needs specific policies and recognition The proposal to set up an expert committee is a positive step and the industry is hopeful that some of the key issues will be resolved soon.
Andy Khanna, Partner, Deloitte India, said the proposal only highlighted the importance the PE/VC industry plays.
“Constituting an expert committee to examine the ecosystem from regulatory and other perspectives and suggest measures should help in the growth of the business. This will boost employment generation and also reduce the cost of raising capital in the country.