IAS Gyan

Daily News Analysis


10th August, 2023 Economy

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Context: The government highlighted that under the North East Venture Fund (NEVF), the government invested Rs 56.84 crores in 37 startups across various sectors and states.


  • The North East Venture Fund (NEVF) is a remarkable initiative that supports startups and creates jobs in the North Eastern Region (NER) and Sikkim. Since its inception in 2017, the NEVF has invested Rs 56.84 crores in 37 startups across various sectors and states. The majority of these startups are from Assam, which has also witnessed the highest employment generation through them.

North East Venture Fund


  • India's North Eastern Region (NER) comprises eight states: Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim and Tripura. The region is rich in natural resources, biodiversity, culture and heritage, but faces many challenges such as geographical isolation, poor infrastructure, low industrialization, insurgency and unemployment.
    • To address these challenges and unlock the potential of the region, the Government of India has launched various initiatives and schemes, such as the Act East Policy, the North East Special Infrastructure Development Scheme (NESIDS), the North East Industrial Development Scheme (NEIDS) and the North East Venture Fund (NEVF).
  • The North East Venture Fund (NEVF) is a government initiative established to promote entrepreneurship, innovation, and economic development in the North Eastern Region (NER). The fund was launched in 2017 to address the unique challenges and opportunities faced by the region and to encourage the growth of startups and small businesses.

The NEVF has several key features

  • Access to Capital: NEVF addresses the funding challenges faced by entrepreneurs and startups in the NER. It provides an alternative source of capital that might not be easily accessible through traditional avenues like banks or financial institutions. This financial support is crucial for startups to initiate and expand their business operations.
  • Mentorship and Guidance: Apart from financial assistance, NEVF offers mentorship and guidance to the investee companies. This support helps startups develop a comprehensive business strategy, refine their products, navigate legal and compliance matters, and plan for their future growth and eventual exit.
  • Networking and Exposure: NEVF facilitates networking and exposure opportunities for the startups it invests in. By connecting them with potential customers, partners, suppliers, investors, and mentors, NEVF enhances the visibility of these startups and helps them establish crucial business relationships both within and outside the region.
  • Value Addition: NEVF contributes to the growth and success of investee companies by adding value in various ways. This includes improving their competitiveness, scalability, sustainability, and profitability, which are all essential factors for the long-term success of startups.
  • Social Impact: NEVF's investments have a positive impact on the region's social and economic landscape. By creating job opportunities, especially for youth and women, the fund contributes to reducing unemployment, boosting income levels, and fostering overall development in the NER.
  • Employment Generation: A key objective of NEVF is to generate employment opportunities. By supporting startups and small businesses, the fund plays a role in job creation, which is essential for improving the livelihoods of people in the NER.
  • Regional Development: NEVF focuses on sectors that align with the NER's strengths and resources. This approach promotes entrepreneurship and innovation that directly contribute to the region's socio-economic development and growth.
  • Targeted Geographical Areas: NEVF's specific focus on startups from the North Eastern states ensures that the benefits of entrepreneurship and economic development are distributed equitably across the entire region, promoting inclusive growth.


  • Economic Development: NEVF's support for startups and small businesses directly contributes to economic growth in the North Eastern Region (NER). As these businesses expand and succeed, they generate revenue, stimulate local economies, and contribute to the overall GDP of the region.
  • Job Creation: NEVF's investments lead to the creation of new jobs, especially for the youth in the NER. Startups are known for their ability to scale quickly and hire talent, which is a significant step in addressing the issue of unemployment and underemployment.
  • Entrepreneurship and Innovation: NEVF fosters an environment that encourages entrepreneurship and innovation. By providing funding, mentorship, and exposure to startups, the fund cultivates a culture of creativity and risk-taking, essential for driving technological advancements and breakthroughs.
  • Reduction of Regional Disparities: The NER has historically faced challenges in terms of infrastructure, connectivity, and economic opportunities. NEVF's focus on supporting startups in this region directly tackles these disparities by injecting capital and resources where they are needed most. This can lead to more balanced development and improved quality of life for the region's residents.


  • Awareness and Outreach: Lack of awareness about NEVF's existence, benefits, application process, and eligibility criteria can hinder potential entrepreneurs and startups in the NER from accessing the funding and support they need. Effective communication and outreach efforts are crucial to address this challenge.
  • Infrastructure and Connectivity: Limited infrastructure and poor connectivity in certain areas of the NER can hinder the ease of doing business and scaling up startups. Adequate physical and digital infrastructure is essential for startups to operate efficiently and access markets beyond the region.
  • Access to Markets: The challenge of accessing larger markets beyond the region can limit the growth potential of startups in the NER. Expanding market reach is crucial for startups' sustainability and scalability.
  • Ecosystem: A weak ecosystem for entrepreneurship development can hinder the growth of startups in the NER. Lack of infrastructure, skilled manpower, market linkages, regulatory support, and mentorship networks can make it difficult for startups to thrive and succeed.
  • Exit: The absence of viable exit opportunities for NEVF's investments poses a challenge. A lack of active secondary markets, strategic buyers, or acquirers can make it challenging for the fund to realize returns on its investments. Additionally, investee companies' lack of readiness for exit in terms of valuation, governance, documentation, and due diligence can further complicate this issue.

Addressing these challenges requires a multi-faceted approach involving collaboration between government agencies, private sector stakeholders, financial institutions, and the startup community. Efforts to improve infrastructure, raise awareness, build a supportive ecosystem, and explore exit mechanisms are all vital for the long-term success of NEVF and the growth of startups in the NER.

Way Forward

  • Enhanced Outreach: Increasing efforts to spread awareness about NEVF's availability and benefits among potential entrepreneurs and startups in the NER through roadshows, workshops, webinars, media campaigns, and other promotional activities.
  • Incubation and Support Ecosystem: Strengthening incubation centres, acceleration programs, and support networks to nurture startups throughout their journey, from ideation to growth. Partnerships with existing incubators, academic institutions, and industry associations can play a crucial role.
  • Capacity Building: Providing training and capacity-building programs to enhance the entrepreneurial skills of individuals in the NER. This can empower them to effectively start and manage their businesses.
  • Market Access: Exploring strategies to improve market access for startups, including leveraging e-commerce platforms and promoting regional products. This can help startups reach a broader customer base beyond their immediate surroundings.
  • Collaboration: Fostering collaboration among various stakeholders, such as fund managers, investors, entrepreneurs, mentors, and policymakers. Creating platforms for dialogue, exchange, and cooperation can lead to a more holistic and supportive ecosystem.
  • Diversification: Expanding the scope of NEVF's investments by exploring new sectors, geographies, stages, and investment models. This can help reduce risk and increase the overall impact of the fund.


  • The North East Venture Fund (NEVF) stands as a beacon of opportunity, kindling innovation and entrepreneurship in the North Eastern Region. Through strategic investments and comprehensive support, NEVF catalyzes economic growth, job creation, and technology advancement. By nurturing startups and enhancing market access, it bridges gaps, diminishes regional disparities, and fosters a culture of innovation. While challenges persist, NEVF's commitment to awareness, collaboration, and diversification paves the path for a thriving ecosystem. NEVF embodies the promise of progress, driving the NER towards a brighter future.

Must Read Articles:

SCHEMES FOR DEVELOPMENT OF NORTH-EAST: https://www.iasgyan.in/daily-current-affairs/schemes-for-development-of-north-east

SUSTAINABLE DEVELOPMENT IN NORTH EAST REGION: https://www.iasgyan.in/daily-current-affairs/sustainable-development-in-north-east-region


Q. What are the key development challenges faced by North East India, and how can these challenges be addressed to pave the way forward? Why is there a pressing need to prioritize the region's development, and what is the significance of overcoming these challenges for both the North Eastern states and the broader national context?