Feedback Form
Home Features Mastermind Forums About Advertise Blog Network Contact Be An Author

VENTURE CAPITAL INVESTMENT IN INDIA

VENTURE CAPITAL INVESTMENT IN INDIA

In recognition of growing importance of Venture Capital as one of the sources of finance for Indian industry, particularly for the smaller unlisted companies, the Government has announced a policy governing the establishment of domestic Venture Capital Funds/Companies. An amendment has also been carried out in the SEBI Act empowering the Securities and Exchange Board of India (SEBI) to register and regulate Venture Capital Funds (VCFs) and Venture Capital Companies (VCCs) through specific regulations.

With a view to augment the availability of Venture Capital, the Government has decided to allow overseas venture capital investments in India subject to suitable guidelines as outlined below :
a. Offshore investment may invest in approved domestic Venture Capital Funds/Companies set up under the new policy after obtaining FIPB approval for the investment. There is no limit to the extent of foreign contribution to a domestic venture capital company/ fund. An offshore venture capital company may contribute 100% of the capital of domestic venture capital fund, and may also set up a domestic asset management company to manage the Fund.
b. Establishment of an asset management company with foreign investment to manage such funds would require FIPB approval and would be subject to the existing norms for foreign investment in non-bank financial services companies.
c. Once the initial FIPB approval has been obtained, the subsequent investment by the domestic venture capital company/fund in Indian companies will not require FIPB approval. Such investments will be limited only by the general restriction applicable to venture capital companies viz.-
i. A minimum lock-in period of three years will apply to all such investments.
ii. VCFs and VCCs shall invest only in unlisted companies and their investment shall be limited to 40% of the paid up capital of the company. The ceiling will be subject to relevant equity investment limits that may be in force from time to time in relation to areas reserved for the Small Scale Sector.
iii. Investment in any single company by a VCF/VCC shall not exceed 20% of the paid-up corpus of the domestic VCF/VCC.
d. The tax exemption available to domestic VCFs and VCCs under Section 10(23F) of the Income Tax Act, 1961, will also be extended to domestic VCFs and VCCs which attract overseas venture capital investments provided these VCFs/VCCs conform to the guidelines applicable for domestic VCFs/VCCs. However, if the VCF/VCC is willing to forego the tax exemptions available under Section 10(23F) of the Income Tax Act, it would be within its rights to invest in any sector.
e. Income paid to offshore investors from Indian VCFs/VCCs will be subject to tax as per the normal rates applicable to foreign investors.
Offshore investors may also invest directly in the equity of unlisted Indian companies without going through the route of a domestic VCF/VCC. However, in such cases each investment will be treated as a separate act of foreign investment and will require separate approval as required under the general policy for foreign investment proposals.





VENTURE CAPITAL INVESTMENT IN INDIA - To learn more about this author, visit Kaviraj Singh's Website.

Like this article? Share it with your friends

Article Feedback
 Article Feedback No article feedback found.
  Leave Your Feedback
article feedback

Article Feedback
David Barr
David Barr is the President of Venture Opportunities, Inc. David has been a professional business broker/intermediary since 1980 focusing on General Business Brokerage and Mergers and Acquisitions representing client transaction value from $400,000 to $20,000,000. Mr. Barr has handled the sale of over four hundred and fifty companies. David earned a university degree from the State University of New York majoring in economics and business. David holds the Mergers and Acquisition Master Intermediary and the Certified Business Intermediary designations from the International Business Brokers Association. He is also a Senior Business Analyst and a Texas licensed Real Estate Agent. For more information about David and Venture Opportunities, visit www.bizdealmaker.com. - Visit David Barr's Website

Leanne Hoagland-Smith
Are your sales where you want them to be? Will you be one of the few who achieves sales or business success or one of the many who have failed to change? Are you tired of being told you are like everyone else? Then you may find my first book on sales of interest. Be the Red Jacket in the Sea of Gray Suits, The Keys to Unlocking Sales available at Amazon or at http://www.processspecialist.com/red-jacket.htm. This book is a reflection of my no-nonsense approach to improving sales to overall business results. If you are truly committed to making sustainable changes, then I can help you secure a positive return on your investment because I focus on executable solutions not telling you the problems you already know you have. From training to corporate (group) coaching to executive one on one coaching, my approach is to assess, create awareness, build a goal driven action plan and then execute. The bottom line question is "Not do you or your employees know it, but do you or they want to do it?" Please call for a free strategy session at 219.759.5601. - Visit Leanne Hoagland-Smith's Website


To learn more about the Evan Elite Author Program please contact us.

About The Author


Kaviraj Singh
(Visit Kaviraj's Website) Kaviraj SIngh is the founder attorney of Trustman & Co – A Law Firm at Delhi India for patent, patent PCT application filing real estate Intellectual property right, prior art search, validity search, corporate law company formation/ incorporation/ registration international trade trademark real estate debt collection credit report due diligence legal risk business law foreign direct investment approval / permission to set up business/ company legal outsourcing LPO Mr. Singh is a member of New York State Bar Association, Intellectual Property Right Section of New York State bar Association, Supreme Court of India Bar Association and Association of Trial Lawyers of America, Bar Council of Delhi. http://www.trustman.org http://www.delhilaw.firm.in/patent_ intellectualpropertyright.htm http://www.delhilaw.firm.in/article news/patentlawindia.htm

Kaviraj Singh is a Gold author on EvanCarmichael.com
About The Author

View Author Blog
View Author Blog

View Author Video
View Author Video

Free Downloads


Kaviraj Singh's

Complete
List Of
Management
Articles

Name
Email
If you enjoyed this article, get Kaviraj Singh's Complete List of Management Articles For FREE!

More Kaviraj Singh
Patent Search
COPYRIGHT LAW INDIA
Remedy for Trade Mark Infringement India
India Debt Collection Business Scenario and Potential
Standards of Professional Conduct and Etiquette for Lawyer India
Basics of US Patent Law
VENTURE CAPITAL INVESTMENT IN INDIA
VISA provisions India
Product Patent Regime in India
EMPLOYMENT LAW INDIA
Free Downloads


 
 
 


Evan Elite Authors
Casey Gollan  
Joe Dager  
John Brennan  
Evan Elite Authors

Become An Author
Have you written articles that would be of value to entrepreneurs? Become an expert on our site by publishing them! Expose yourself to a wide audience, drive more traffic to your website and get more sales! Click Here for details.
Become An Author

Evan's Latest Video
Modeling the Masters: Learn the true secrets behind Walt Disney's business success factors & grow your company! Video produced by Phanta Media
Evan's Latest Video

Business Opportunities
"Learn straight from Evan how you can Make a Full Time Income (And More) from a Website"

How to Start An Online Business

Click Here To Learn More
Business Opportunities



Evan's Newsletter
Get advice & tips from famous business owners, new articles by entrepreneur experts, my latest website updates, & special sneak peaks at what's to come!
Name:
Email:
Evan`s Newsletter

Free Downloads
Pro-Forma Template Icon Pro-Forma Template
The Evolution Of Networking Icon The Evolution Of Networking
Networking Is The Future Icon Networking Is The Future
Client-Attracting Web Copy Icon Client-Attracting Web Copy
Think Networking Icon Think Networking
Free Downloads - Complete List

Entrepreneur Tools and Guides
Top 50 Franchising Blogs
Top 50 Franchising Blogs
Top 50 Franchising Blogs
 
Top 50 HR Blogs 2009
Top 50 HR Blogs 2009
Top 50 HR Blogs 2009
 
Entrepreneur Tools and Guides

SEO For Africa
SEO For Africa
Agnes Londo Agoe, Togo,
Agnes Londo
Agoe, Togo
SEO For Africa

If I Were A Startup...
Lisa Shepherd, $335k to $1.1 Mil in 2 years
Lisa Shepherd
$335k to $1.1 Mil in 2 years
Brian Scudamore, $200k to $8 Mil in 5 years
Brian Scudamore
$200k to $8 Mil in 5 years
If I Were A Startup... - Complete List

Famous Entrepreneurs
Jenny Craig, Jenny Craig
Jenny Craig
Jenny Craig
King Gillette, The Gillette Company
King Gillette
The Gillette Company
Famous Entrepreneurs - Complete List

Entrepreneur Advice
Donald J. Trump, Trump University
Donald J. Trump
Trump University
Paul Kedrosky, Venture Capitalist
Paul Kedrosky
Venture Capitalist
Entrepreneur Advice - Complete List

Popular Articles
(Premium Authors)

     How To Loose Home Party Sales And Alienate Your Customers
By Patricia Makhulo
     Jewelry Home Party Business Home Party Marketing Experts Secrets EXPOSED
By Patricia Makhulo
     Personal Finance Articles: How Changing Your Mind About Your Personal Finance WILL Change The State Of Your Wallet
By Patricia Makhulo

Have A Suggestion?
Toronto Salsa Classes / Toronto Salsa Lessons Email us your ideas on how to make our website more valuable! Thank you Sharon from Toronto Salsa Lessons / Classes for your suggestions to make the newsletter look like the website and profile younger entrepreneurs like Jennifer Lopez and Sean Combs!
Have A Suggestion?

More Evan Carmichael
More Information