Cabinet clears ₹10,000 crore startup India Fund of Funds 2.0 to boost deep tech, early-stage ventures

 In a significant push to India’s venture capital ecosystem, the Union Cabinet chaired by Prime Minister Narendra Modi has approved the ₹10,000 crore Startup India Fund of Funds 2.0 (FoF 2.0). The new corpus is aimed at mobilising long-term domestic capital for innovation-led enterprises, with a sharper focus on deep technology, advanced manufacturing and early-growth startups.

The move is intended to address structural funding gaps, particularly in high-risk sectors that require patient capital and longer gestation periods.

Build ing on a decade of startup expansion

FoF 2.0 builds on the momentum of the Startup IndiaInput text is missing. Please provide the text you would like to have paraphrased.programme launched in 2016. Over the past decade, India’s recognised startup base has expanded from fewer than 500 ventures to more than 2 lakh entities registered with the Department for Promotion of Industry and Internal Trade (DPIIT), with 2025 marking the highest-ever annual registrations.

The first Fund of Funds for Startups (FFS 1.0) had committed its entire ₹10,000 crore corpus to 145 Alternative Investment Funds (AIFs). These AIFs have invested over ₹25,500 crore in more than 1,370 startups spanning artificial intelligence, clean technology, fintech, biotechnology, automotive and space technology. The scheme played a catalytic role in crowding in private capital and backing first-time founders.

Targeted capital for high-risk, High-impact sectors

Unlike the earlier phase that focused on ecosystem creation, FoF 2.0 adopts a segmented funding approach. It will prioritise deep tech and technology-driven manufacturing ventures, expand support for early-growth stage founders, and encourage investments beyond established startup hubs.

The scheme also seeks to strengthen smaller domestic venture funds, deepening the institutional capital base. By directing capital towards priority sectors aligned with economic self-reliance and industrial competitiveness, the government is positioning FoF 2.0 as a strategic lever to accelerate India’s innovation-driven growth trajectory.