Description

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Context:

The Union Cabinet approved a Rs. 1000 crore Venture Capital Fund for the space sector under the Indian National Space Promotion and Authorization Centre (IN-SPACe).

Venture Capital Fund for the space sector

The Venture Capital Fund for the space sector is the support scheme for Space technology startups in India.

It will be operationalised by the Indian National Space Promotion and Authorization Centre (IN-SPACe).

The fund deployment will be for over five years from the start of fund operations.

Regulatory Framework

The fund will function as an Alternative Investment Fund under SEBI regulations.

Benefits

It will provide an additional private investment for later-stage development of space assets

The VCF will deter Indian space companies from relocating to overseas locations.

The VCF aims to achieve a five-time increase in the Indian space economy within the next decade.

It also aligns with Atmanirbhar Bharta’s Vision of self-reliance in the Space technology sector.

Investment across the space supply chain through the VCF is expected to generate direct jobs in engineering, software, data analysis, and manufacturing, apart from indirect jobs in logistics and professional services.

IN-SPACe

It is an autonomous agency established to facilitate private sector participation in India's space sector.

It was established in 2020 to operate under the Department of Space, Government of India.

Roles:

Authorise Private Players: IN-SPACe authorises and regulates the activities of private sector companies in India's space sector.

Promote Collaboration: it aims to facilitate and encourage collaboration between private companies and ISRO.

Single-Window Clearance: It also serves as a single-window clearance system to make the entry process for private companies easy and hassle-free.

Read more:

IN-SPACe

Alternative Investment fund:

AIF is a privately pooled investment vehicle which often invests in alternative asset classes including private equity, venture capital, hedge funds, real estate, commodities, and derivatives.

Read more:

Alternative Investment fund

Venture Capital Fund:

VCF is a pool of funds invested by investors to start-ups and small businesses having long-term growth potential.

The fund is provided to them in exchange for equity stakes.

Read more:

Venture Capital Fund

Sources:

PIB

DDNEWS

PRACTICE QUESTION

Q.Consider the following statements about the “The Venture Capital Fund for the space sector” recently seen in the news:

It is a Fund for the space sector under the Indian National Space Promotion and Authorization Centre (IN-SPACe).
The fund deployment will be for over five years from the start of fund operations.
The fund will function under regulations made by the Reserve Bank of India.

How many of the above statements is/are correct?

A.Only one

B.Only two

C. All Three

D.None

Answer: B

Explanation:

Statement 1 is correct:

The Union Cabinet approved a Rs. 1000 crore Venture Capital Fund for the space sector under the Indian National Space Promotion and Authorization Centre (IN-SPACe).

The Venture Capital Fund for the space sector is the support scheme for Space technology startups in India.

It will be operationalised by the Indian National Space Promotion and Authorization Centre (IN-SPACe).

Statement 2 is correct:

The fund deployment will be for over five years from the start of fund operations.

Out of total Rs. 1000 allocated for the scheme, Yearly Allocation would be: