The Union Cabinet has approved a new Rs 10,000 crore fund to help Indian startups secure the investment they need to grow. Known as the Startup India Fund of Funds 2.0, the money will specifically target deep tech, advanced manufacturing, and early-stage founders. The goal is to ensure that innovative ideas do not fail simply because they cannot access early financial support.
This new fund follows the first version of the scheme launched in 2016. The government noted that the original programme successfully supported over 1,370 startups by committing its entire Rs 10,000 crore corpus to various investment funds. These funds, in turn, invested more than Rs 25,500 crore in companies working in fields such as artificial intelligence, healthcare, and space technology. The press release stated that the first phase “played a pivotal role in nurturing first-time founders” and helped build a “strong foundation for India’s venture capital ecosystem.”
One of the main objectives of the 2.0 version is to support high-tech sectors that take a long time to develop. The government aims to provide “patient, long-term capital” for breakthroughs in deep tech and innovative manufacturing. By focusing on these challenging sectors, the scheme seeks to address “high-risk capital gaps” that are often overlooked by private investors but are essential for the country to become more self-reliant.
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The fund is also intended to extend beyond major cities such as Bengaluru and Delhi. The government wants to encourage investment across the country so that innovation can thrive everywhere. According to the release, the scheme is “designed to accelerate the next phase of India’s startup journey by mobilising long-term domestic capital” and reducing the country’s dependence on foreign investment.
Since 2016, the number of recognised startups in India has grown from fewer than 500 to more than 2 lakh. The government believes this new injection of capital will help sustain that momentum. The release concluded that the fund will contribute to “strengthening India’s economic resilience, boosting manufacturing capabilities, and generating high-quality jobs” as part of the broader national goal of becoming a developed nation by 2047.
