SBICAP Ventures Limited (SVL), a subsidiary of the State Bank of India (SBI) has signed a Memorandum of Understanding (MoU) with the Ministry of External Affairs (MEA), Government of India for establishing the Trilateral Development Cooperation Fund (TDC Fund).
The TDC Fund will route India’s commitment of approx. INR 175 Cr to the Global Innovation Development Fund (GIP Fund) – an Alternative Investment Fund (AIF) proposed to be established in partnership with the Foreign, Commonwealth, and Development Office (FCDO) under the India – UK Global Innovation Partnership (GIP).
The GIP Fund will invest in mainly small & medium enterprises from India that tackle development challenges in line with the goals and objectives of the GIP and have successfully developed and tested viable social impact innovations that can be transferred and scaled up in third countries. GIP Fund will target Indian innovative enterprises that are at an advanced stage but lack access to capital for expansion to other developing countries.
Established as an AIF, the TDC Fund will operate as a ‘Fund of Funds’ under the SEBI AIF Regulations. SVL will act as the administrator-cum-advisor (Investment Manager) of TDC Fund and facilitate the GIP program for MEA.
In the future, the Ministry of External Affairs could potentially utilise the TDC Fund to contribute to AIFs similar to the GIP Fund established in partnership with other partner countries under the trilateral development cooperation framework.
Sharing thoughts on the same, Shri. Sandeep Chakravorty, Joint Secretary (Europe West) MEA, said, “MEA is committed to the growth and development of Indian enterprises abroad. Innovative Indian models are now maturing with learnings from existing markets and planning to move to new markets. GIP will help expand the footprint of Indian innovations abroad.”.
Shri. Suresh Kozhikote, MD & CEO, SVL shared his thoughts on the partnership, saying, “The Trilateral Development Cooperation Fund will demonstrate as well as reduce risk perception for innovation transfer. This collaboration will be a building block towards structuring investments into innovative enterprises from India and facilitate further development, transfer, and scale-up of successful innovations to developing partner countries.”
Akshay Panth, Chief Investment Officer, SVL added, “We are proud to be the partner of choice for the Government of India across multiple fund initiatives. Through the TDC Fund, we seek to address the capital requirements of small & medium businesses that are embarking on their global journeys and help them successfully scale up across multiple geographies.”
SBICAP Ventures Ltd is an alternative asset manager based in India, belonging to the State Bank of India Group, and manages funds across private equity, real estate, and fund of funds mandates.
In March this year, SBICAP raised around INR 1,500 Cr for its Neev Fund II- a small-and medium-enterprise (SME) fund managed by SBICAP Ventures Ltd.
Its Neev Fund is the outcome of a partnership between the State Bank of India and the UK’s Department for International Development (DFID). It’s an Infrastructure private equity fund focused on creating sustainable development.
The primary objective of the Fund is to create sustainable development which will provide economic, social, and/or environmental benefits to the poor in some of the poorest regions of India through market returns on capital investments by carrying out the activity of a Category I Infra AIF, as permissible under the AIF Regulations, as per its website.
