India: NABARD floats $100m VC fund to invest in agri, food startups

Agricultural paddy

India’s National Bank for Agriculture and Rural Development (NABARD) Monday announced that it is setting up a $100-million (Rs 700 crore) venture capital fund to invest in agriculture and rural-focused startups.

This is a first such initiative by NABARD, which was until now investing in other VC funds as a limited partner. The fund will be raised under Nabventures, the newly incorporated venture arm of NABARD, PTI reported citing an official statement.

The fund has a proposed corpus of Rs500 crore with an option to retain over-subscriptions of Rs200 crore, called as the greenshoe option. NABARD has given an anchor commitment for the fund, which will be investing across startups engaged in agriculture, food and rural development space, the report said.

The details of contributions made by NABARD towards the fund, and identity of other limited partners was, however, not disclosed. Nabventures is now scouting for equity investments in asset-light, innovative, technology-led startups in its focus areas, the statement said.

Nabard chairman Harsh Kumar Bhanwala said the fund will help boost the agricultural and rural ecosystem.

Last year, NABARD invested about Rs 45 crore in three venture capital funds — Aavishkar Bharat Fund, Orios Partners and IFMR Fimpact Long-Term Fund in FY18 to promote technological innovations and technology dissemination in the agriculture and rural development sectors.

Till date, NABARAD has invested Rs273 crore in 16 alternate investment funds.