The capital will be invested in start-ups by way of providing equity, quasi equity, soft loans and other risk capital.
The proposal to establish a VC fund was unveiled by Finance Minister Arun Jaitley while presenting the interim Budget last year. The move was aimed at creation of a conducive eco-system for the venture capital in the MSME sector.

"The Reserve Bank of India has already allocated Rs 10,000 crore to Small Industries Development Bank of India (SIDBI) from priority sector lending (PSL) shortfall, for the purpose," MoS (Independent Charge) for Skill Development & Entrepreneurship Rajiv Pratap Rudy said in a written reply in the Rajya Sabha.
The allocation has been made "in pursuance of the announcement made by the Finance Minister in the Union Budget for 2014-15 for establishment of a Rs 10,000 crore fund to act as a catalyst for attracting private capital by way of providing equity, quasi equity, soft loan and other risk capital for start-up companies", Rudy said.

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