Govt Notifies ₹10000 Crore Startup India FoF 2.0 to Boost Deep Tech, Manufacturing
The new fund builds on the earlier Startup India Action Plan, under which the original Fund of Funds for Startups (FFS 1.0) was launched in 2016 to address capital gaps and catalyse domestic investment.
Second fund-of-funds targets AIF-led capital deployment; SIDBI to operationalise scheme
New Delhi: The Union government has notified the Startup India Fund of Funds 2.0 (FoF 2.0) with a corpus of ₹10,000 crore, aimed at mobilising venture and growth capital for India’s startup ecosystem, with a sharper focus on deep tech, early growth-stage ventures, and technology-driven manufacturing.
The new fund builds on the earlier Startup India Action Plan, under which the original Fund of Funds for Startups (FFS 1.0) was launched in 2016 to address capital gaps and catalyse domestic investment.
Under FoF 2.0, commitments will be routed through SEBI-registered Alternative Investment Funds (AIFs), with allocations spread across the 16th and 17th Finance Commission cycles. The scheme is designed to strengthen funding pipelines for priority sectors, including deep tech startups, emerging ventures backed by smaller AIFs, and innovation-led manufacturing companies.
The fund will adopt a structured selection process for AIFs, overseen by a Venture Capital Investment Committee (VCIC) comprising ecosystem experts. An Empowered Committee will monitor implementation and performance, while provisions for co-investment with government and institutional investors have been incorporated under a defined governance framework.
The Department for Promotion of Industry and Internal Trade will issue detailed operational guidelines and finalise the composition of the VCIC.
Implementation of the scheme will be led by Small Industries Development Bank of India, which will act as the primary agency from the date of notification. The government will also appoint an additional domestic implementation agency to expand execution capacity.
FoF 2.0 is expected to accelerate India’s innovation-led growth by enabling startups to build globally competitive technologies and products. The scheme is aligned with the broader Viksit Bharat @ 2047 vision, with a focus on strengthening economic resilience, enhancing manufacturing capabilities, and generating high-quality employment.
By deepening access to capital through institutional investment channels, the government aims to further position India as a global hub for innovation and entrepreneurship.
