National Innovation Council

Realising that innovation is the engine for the growth of prosperity and national competitiveness in the 21st century, the President of India has declared 2010 as the ‘Decade of Innovation’. Read More

NInC Initiatives

State/Sectoral innovation council                                                                                                                                        Industry/ University Innovation Clusters Read More

International Collaboration

Analysing the Innovation perspectives around the globe. Read More

National Innovation Council NInC Initiatives International Collaboration

NIC’s Rs 500 crore fund for companies serving poor, innovation clusters soon

Source: My Digital FC, November 4, 2012

The National Innovation Council (NIC), set up by the Prime Minister to create Indian model of innovation, is preparing to launch its fund with an initial corpus of Rs 500 crore shortly and that will lend to companies focusing on delivering goods and services to the poorest people in the country. It is also looking to facilitate creation of industry innovation clusters (IIC) for job creation and productivity.

The fund is expected to be operational by early next year. NIC has collaborated with the union ministry of micro, small and medium enterprises (MSMEs) to steer the fund towards its final stages of approval and an innovative structural design has been developed for the fund. The initial investment prospects are being identified.

“We are in the final stages of launching the India Inclusive Innovation Fund (IIIF) to finance innovative enterprises focused on the bottom of the pyramid. In the long term, the fund will aspire to an eventual size of Rs 5,000 crore, but will initially be operationalised with an initial corpus of Rs 500 crore with contribution from the government, banks, institutions and multilateral agencies,” Sam Pitroda, chairman of the NIC and adviser to the prime minister, said in NIC’s annual 'Report to the People 2012'.

The fund will be governed by a trust, which will be registered with the SEBI. Union ministry of finance included Rs 100 crore to kickstart the same in its union budget 2012. About Rs 145 crore has been contributed by public sector banks and financial institutions. The fund will invest directly firms serving bottom of the pyramid (BoP) as well as indirectly through BoP-focused funds. It will invest across the venture development cycle – early stage to scale up. It will operate as a ‘for profit’ entity and give targeted social and economic returns to investors, according to a NIC document on IIIF.

Fund will target gross investment internal rate of return (IRR) of 10 per cent per annum before taxation and management charges. Fund life is expected to be 10 years, which is extendable by up to three years.

The Council is also in the process of compiling learnings from seven industry clusters in order to replicate it across industry clusters in the country under industry innovation clusters (IIC) programme, which will be a PPP model.

The pilot phase of this initiative has been operations in seven clusters across the country, which includes auto components (Faridabad, Haryana), Ayurveda (Thrissur, Kerala), Bamboo (Agarthala, Tripura), brassware (Moradabad, UP), food processing (Krishnagiri, Tamil Nadu), Furniture (Ernakulam, Kerala) and life sciences (Ahmedabad, Gujarat). By the end of pilot phase, the aim is to successfully demonstrate 10-12 new products, 7-10 process improvements and two new centres at the clusters.

NIC has been working with state governments, MSME and textile ministries, CSIR and IL & FS, among others in this effort and is hoping to replicate the innovation cluster model in 80-100 clusters by the end of 2013.

BCMath lib not installed. RSA encryption unavailable