Foreign Direct Investments have been backing emerging technologies as overseas investors are traditionally attuned to investing in technologies that are promising and are globally competitive. In the last four years, 10 sectors attracted investments up to 75 per cent of the total FDIs in India, of which drugs and pharmaceuticals occupy five per cent, standing at eighth position.

In the last three years, early stage funding in India by venture capitalists has been below two per cent of the total funds. India is still behind US in funding early stage companies, according to Sarath Naru, managing director of APIDC VCL. He was speaking in a meet organized by The IndUS Entrepreneurs (TiE) at Hyderabad on Thursday.

Big idea and big science is still emerging in India. Government must create NIH and SBIC type funding programmes in India. Healthcare delivery systems that target rural areas and healthcare therapies that will meet unmet needs are essential, Naru added.

Srini Raju, chairman, iLabs Ltd, said, the West has developed enormous interest in India, but China is still leading in this race. Transparency, legal systems, respect for IP will help India in the long run.

Early stage funding is very critical for biotech companies. Venture capitalists should realise the potential of small companies in the sector, as most of the innovation in the West has actually come from smaller players in the industry, Dr Krishna M Ella, Bharat Biotech International said.

Akhil Awasthi, Baring Equity Partners (India), said, in order to encourage and fund innovation in biotechnology and pharmaceuticals, VCs should at first place be able to find sufficient number of companies willing to take up innovation or involved innovation.

Various aspects with regard to venture capital funding and emerging opportunities in Biotechnology were discussed in a panel discussion conducted as part of the meet.

Ratna Prabha, secretary, IT & C Department, Government of AP; Anuradha Acharya, CEO of Ocimum Biosolutions, Rahul Patwardhan, president and CEO of IndiaCo; Dr V Chandrasekar, ED, Wadhwani Centre for Entrepreneurship Development, ISB; JA Chowdary, president, TiE-Hyderabad, also took part in the meet.