| A first of its kind initiative by Nasscom, the fund will support companies dealing with emerging technologies and life sciences. IP creation, however, is a must. |
| "We are not looking at call centers, knowledge process outsourcing (KPO) companies or BPOs," Rajdeep Sahrawat, vice-president, Nasscom, told Business Standard. |
| "Big companies, especially the large global players have their own research and development (R&D) budgets and access to venture capitalists. This fund is targeted at companies creating original IP and require support in the early stages," he said. |
| Nasscom is currently putting together a detailed plan for the Innovation Fund, which it will share with companies in the near future. |
| The core model is that it will be run as a separate commercial entity with the fund corpus created by industry firms. Contributions to the fund is purely on voluntary basis although it is not restricted to IT companies. |
| "Several IT companies and even financial institutions have also shown interest in contributing to the fund," Sahrawat said. Nasscom will perform the role of a facilitator and enabler. |
| The industry body has identified the following as key focus areas for the fund: wireless broadband, automotive infotronics, multimedia convergence, medical devices, life-sciences and embedded platforms. |
| "As these areas have a higher risk profile and longer payback periods when compared to traditional services, most venture capitalists do not invest at the seed stage," he said. |
| According to KPMG Global Head (Sourcing Advisory) Pradeep Udhas, such a fund is also likely to provide much needed impetus to IT R&D in the country. |
| "Globally, companies spend 8-9 per cent of their total budget on R&D. In India, it is only around 2 per cent. Since IT is where India has an edge, we must help innovators unleash their creativity," he said. |
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