BENGALURU: The Startup India initiative, launched three years ago by Prime Minister Narendra Modi , has allocated just under 20% of its Rs 10,000-crore corpus to venture capital (VC) funds.Mohammad Mustafa, chairman and managing director of the Small Industries Development Bank of India (Sidbi), which manages the fund-of-funds for the Startup India Action Plan, said Rs 1,900 crore had been committed to VC firms by the end of December 2018. According to figures available publicly, the allocation had stood at close to Rs 1,500 crore by the end of September 2018. Mustafa said the fund-of-funds will close the financial year with a Rs 3,300-crore allocation to VCs.The government launched the initiative to help startups get funding in early stages. The fund doesn’t directly invest in startups. Instead, it allocates money to VCs, which are required to invest at least twice the amount of contribution received from the government.Over the past two weeks, the Startup India initiative has come under criticism after hundreds of entrepreneurs complained of harassment by I-T authorities who sent them ‘angel tax’ notices. For now, the government has assured them there won’t be any coercive action to demand taxes from startups. The government had made similar promises a year ago when the issue first came to the fore.Mustafa also said the Startup India fund, leveraging on technology, will bring in ‘ automation ’ by next fiscal, which will ensure faster disbursals to VC firms looking to raise capital from the government’s initiative. “There is a lot of demand, and VC firms are reaching out for capital. We are looking to roll out an automated platform that will do away with physical filing of forms or interactions with Sidbi. Essentially, it will cut down the process by two-three months for VCs to apply and avail of funding,” said Mustafa.It currently takes four-five months for a VC to apply for and get fund approval. According to official records, Kae Capital, Orios Venture Partners, Stellaris Venture Partners and Alteria Capital, among others, received capital from the government’s fund-of-funds.The Startup India fund is supposed to be deployed during the 14th and 15th Finance Commission cycles. Over the past few years, the government has been showing interest in focusing on startups since they play an important role in creation of jobs. Startup India was one of the initiatives highlighted in the G20 summit in Argentina this year.