India’s Innovation Engine: Government Fund Deploys ₹257.77 Cr to Nurture Deep-Tech Ecosystem
SDG 9: Industry, Innovation, and Infrastructure | SDG 8: Decent Work and Economic Growth
Institutions: Ministry of Electronics and Information Technology (MeitY) | Department of Financial Services (DFS)
The Electronics Development Fund (EDF), launched by the Government of India in February 2016, is a strategic Fund of Funds designed to promote research, development, and entrepreneurship in the fields of electronics, nano-electronics, and information technology. The fund is anchored by the Ministry of Electronics and Information Technology (MeitY).
The EDF’s key strategic goal is to enhance India’s capacity for indigenous design and development in the Electronics System Design and Manufacturing (ESDM) sector and build a national Intellectual Property (IP) resource pool.
Operational Model and Impact (As of September 30, 2025)
The EDF operates by investing in professionally managed Daughter Funds (registered as SEBI Category I or II Alternative Investment Funds—AIFs), which in turn provide risk capital to technology startups.
Financial Leverage: EDF has invested ₹257.77 crore in eight Daughter Funds. These Daughter Funds have collectively leveraged the initial investment to make further investments totaling ₹1,335.77 crore.
Startup Reach: This funding has supported 128 startups and ventures across frontier areas such as Internet of Things (IoT), Robotics, Drones, HealthTech, Cyber Security, and Artificial Intelligence (AI) and Machine Learning.
Tangible Outcomes: The program has successfully generated a strong base of innovation, supporting the creation or acquisition of 368 Intellectual Properties (IPs) and the creation of over 23,600 jobs in high-technology sectors.
The EDF is a vital demonstration of how public capital can be used strategically to de-risk and catalyze private investment in India’s technology ecosystem. By focusing on indigenous design, R&D, and IP creation in deep-tech domains like AI and IoT, the fund directly supports the national imperative of self-reliance (Atmanirbhar Bharat), strategically reducing dependence on foreign technologies and positioning India as a global hub for Electronics System Design and Manufacturing (ESDM).
What is the “Fund of Funds” model, and why is it used for the Electronics Development Fund (EDF)?→ The Fund of Funds model means that the central government entity (MeitY/EDF) does not invest directly into startups. Instead, it invests its capital into other professionally managed venture capital firms (Daughter Funds). This model is crucial because it leverages the specialized expertise and market reach of private fund managers, ensures professional management, maintains transparency (by requiring SEBI registration), and successfully mobilizes significantly greater private capital (leveraging ₹257.77 crore of government funds into over ₹1,335 crore of total investment).
Relevant Question for Policy Stakeholders: How should the Ministry of Electronics and Information Technology measure the long-term impact of the EDF in strategically reducing India’s import dependence in key technology components?
Follow the full news here: Electronics Development Fund