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Punjab launches SIV fund for SMEs


5/23/2018
LAHORE: The Punjab government has formally launched the Specialized Investment Vehicle Fund, the first of its kind in Pakistan to provide Private Equity/Venture Capital to SMEs and Startups.
The Fund was launched by Sheikh Allauddin - Minister of Industries, and Patchamuthu Illangovan - Country Director World Bank Group Pakistan through Investment Climate Reform Unit (ICRU.) of P&D in partnership with the private sector keeping in view experience of leading industrial & innovative hubs such as Turkey, Indonesia & Singapore to crowd in the private sector in Public development investments. 
According to official sources the Asian Development Bank and UK's Department for International Development have committed to provide $123 million to promote public private ventures in Punjab. 
Speaking at the launch ceremony Farid Ahmed Khan- CEO HBL Asset Management said, "The Fund/ Specialized Investment Vehicle (SIV) is a Social Impact Fund, with a double bottom-line, which will be self-sustaining in perpetuity. It will be established under the laws of Pakistan and the regulations issued by Securities and Exchange Commission of Pakistan with the objective of improving business climate, creating employment, training and developing new entrepreneurs, supporting women entrepreneurs and providing easy access to finance to deserving projects, through several modes such as direct investment by way of Private Equity and Venture Capital funding." 
 
The Fund will target crucial and vital sectors of the provincial economy, such as Agriculture and Livestock and social sectors like Healthcare, Education, Transportation Research and feasibility studies will also be covered and supported under this program with the special emphasis on the women enterprises, job creation, training and skill development, startups by young entrepreneurs and Cottage & Small Scale industries. 
The Fund or Specialized Investment Vehicle has been accordingly designed with an array of investment product suggested as per the need/ model of the business or sector. These products and underlying instruments range from debt to Private Equity and Venture Capital. In certain products (e.g. on the lending side) the fund would work through partner institutions and would leverage their expertise, diligence and outreach in their respective areas. 
Maleeha Bangash, MD ICRU stated that "in the initial scoping for the Specialized Investment Vehicle/Fund it was identified that there was a huge gap in terms of access to finance for SMEs and start-ups in general and actually a market failure in providing Private Equity and Venture Capital funding to SMEs, start-ups, women and so on, and the Government needed to step in. We are confident that this initiative will fill this gap, as well as correct this market failure for Private Equity and Venture Capital while sharing some of the risk of the private sector. There has been a great interest from Private sector, investors and partner institutions to work with the ICRU, through this Fund which will have a long lasting Social Impact."