| Corpus for revival
The “landless” state has taken the funds pool route to promote industries.
Plans are afoot for creating a sort of corpus fund to assist those who have innovative ideas but cannot execute them for want of money. A part of it would also be used to revive potential sick units.
The talks on the new fund came to the fore barely a week after the state government claimed that initiatives were being made for the creation of a venture capital fund.
Sources in the industries department told The Telegraph that the fund, in excess of Rs 100 crore, would be set up in association with the World Bank. “It will be a sort of corpus fund. Senior officers of the department had initially talked about it last April just for helping sick units. Now, it would also be used to promote good ideas. The finer details are being discussed. The World Bank has shown interest towards helping the state in developing the fund by providing financial support. Things will be given a final shape soon,” an officer at the industries department told The Telegraph.
In the Industrial Incentive Policy of 2011, there is a provision for the creation of a corpus fund for the revival of the suck units. According to the policy, the state government should create the fund in association with banks and industrial bodies. Sources pointed out that both the World Bank and the state government were expected to contribute to the fund.
“Many people, mostly entrepreneurs, come up with very good and innovative ideas but cannot execute them because of funds crunch. This fund aims to help out such people by providing them with the capital after a screening process,” another officer told The Telegraph.
The sources said a committee, comprising senior officials of the industries department and its wings, would be formed for the screening process.
“In order to get capital from the fund, an entrepreneur would have to convince the screening committee that the idea floated is concrete and has potential. He/she must be very clear about the idea and should be able to explain it to the committee. If the committee members are convinced after hearing the explanations and going through the project report, the capital would be provided from the fund. The government would be working closely with the entrepreneur and will assist the person concerned in getting the essential things to see his dream come true,” he said.
The officer added: “There must be many sick units, which if revived, can be a game-changer. A unit becomes sick for a number of reasons — the primary of which is unavailability of funds. In Bihar, banks are slightly reluctant to grant loans to entrepreneurs. The committee will be studying the potential of sick units. If its members find that they can grow, adequate assistance would be provided to them.”