The Ministry of Development of North-East Region (M-DoNER) has recently released an update on the North East Venture Fund scheme. This scheme, launched in September 2017, is a unique project dedicated to nurturing venture capital for the North Eastern Region (NER). This initiative was put together by the North Eastern Development Finance Corporation Limited (NEDFi) in collaboration with M-DoNER.
Understanding the North East Venture Fund
The North East Venture Fund is the first of its kind, focusing exclusively on the NER. It’s a potent form of private equity or financing that is provided to startup companies and small businesses believed to bear long-term growth potential. The capital usually arises from affluent investors, investment banks, and other financial institutions.
Financial Structure of the Scheme
The venture capital fund has a committed capital amounting to Rs 100 crores. The investment under this scheme can range from Rs. 25 lakh to Rs. 10 crore per venture. Given its objective of driving long-term growth, it follows a long-term investment horizon of 4-5 years.
Objectives of the North East Venture Fund
The primary goal of this scheme is to stimulate entrepreneurship development in the NER. The fund aims to achieve attractive risk-adjusted returns through long term capital appreciation by way of investments in privately negotiated equity or equity-related investments. It targets startups and unique business opportunities, providing resources specifically for new ventures in fields like Food Processing, Healthcare, Tourism, IT, and service segregation.
Additional Development Initiatives for North-Eastern Region
There are several other initiatives aimed at developing the North-Eastern region. These include The North East Rural Livelihood Project (NELRP), launched in 2012, which is a World Bank aided, multi-state project that aims to improve rural livelihoods, especially of women, unemployed young people, and the most disadvantaged.
Under an overarching framework provided by the ‘North Eastern Region Vision 2020’ document, there are projects like Science & Technology Interventions in the North East Region (STINER). It aims to bring relevant technologies developed by academic, scientific, and research institutions to artisans and farmers, with a special focus on women.
Infrastructure Improvement Projects
The North Eastern Region Power System Improvement Project (NERPSIP) was approved in December 2014 as a Central Sector Scheme of the Ministry of Power. Its main aim is to create a reliable power grid, improve NER States’ connectivity to upcoming load centers, and extend the benefits of grid-connected power to all consumer categories in the North Eastern Region.
Promoting North-East Culture and Entrepreneurship
The ‘Destination North East festival’ replicates different facets of Northeast, including entrepreneurship avenues, across various locations in the country. During these events, exclusive arrangements are made for offering counselling and assistance to potential entrepreneurs and business startups.
Conclusion
The various schemes and initiatives, especially the North East Venture Fund, reflect the concerted efforts by government bodies like M-DoNER and NEDFi to foster entrepreneurship and overall development in the North-East Region. With a mix of financial aid, infrastructure improvement and awareness programs, the future of the North-East Region seems poised for growth and prosperity.