Calcutta: Vedanta Resources Plc, the world’s sixth largest diversified mineral resource conglomerate, will launch a Rs 5,000-crore venture capital fund for mineral-based manufacturing start-ups in India.

Vedanta will partner top policy making body Niti Ayog and consulting firm Accenture to identify opportunities in the small and medium sector.

It hopes to get approval from the boards of the London Stock Exchange-listed company and Indian arm Vedanta Ltd for the fund by the end of this year. The plan is to launch the fund by the end of this financial year, chairman Anil Agarwal said.

“Several construction and automobile components that are being imported can be manufactured here. There are opportunities in copper, aluminium, zinc, silver, gold oil and gas. This is the time for start-up SMEs. We have been doing for technology, now is the time for manufacturing. Units can start at as low as Rs 5 crore and can go up to Rs 100 crore. I will fund them for feasibility. They have to come up with a bankable document, then go to the bank, secure a loan, and if there is any equity required, we will provide. We will take the risk,” Agarwal said in an interview.

The Vedanta chairman met senior officials of the Niti Ayog last week to discuss the plan. “The government is fully with it (fund). They will plan it for us. They will help us to create a platform so that youngsters can participate.”

Vedanta also engaged with consulting firm Accenture which may identify the projects. The company, which posted a revenue of $11.5 billion in 2016-17, will bear the cost of the work too.

Asked if securing debt would be a challenge at a time lenders are wary of financing because of the bad loan burden, Agarwal said, “Banks are flushed with funds. If you have good feasibility and equity, debt will not be a problem.”

Agarwal’s project stands apart as most funds usually bet on technology-based start ups. Vedanta seems to be focusing on metal-based industries, especially in sectors where it is the primary producer as a miner.

However, the Vedanta chairman said as he turned 60, his aim in life now would be to help create 50 more Vedantas in the future.

Bengal plans

Agarwal, who spent his childhood in Calcutta, said Bengal would be the ideal place for the processing units to come up.

“We will create lot of industries through this fund. Bengal is the best place for SMEs. Power is available, best of brains is available, cost of labour is low…We will supply the raw material. Bengal is a very good place for contracting and outsourcing,” Agarwal said during his 12-hour whirlwind trip to Calcutta.

Apart from meeting families and friends, he delivered a lecture at IIM Calcutta and addressed a gathering of Young President’s Organisation before heading for London, where he lives.

In 2008, Vedanta had expressed willingness to build an aluminium smelter and power plant in Burdwan. But a cocktail of events – the global financial, Coal India’s insistence to move the original location of the plants from the coal bearing area and company’s inability to open a bauxite mine in the Niyamgiri hills in neighbouring Odisha – queered the pitch for the project.

Agarwal said he would look at the state afresh if and when mines come up for auction. In his address to IIM Calcutta today, Vedanta chief exhorted students to become junior miners. “Naukri ke piche mat bhago”, he said asking them to become entrepreneurs and miners as technology has become available at an affordable cost.

Source: Telegraph India