The Karnataka Government plans to set up a corpus of Rs 50 crore (Rs 500 million) to provide seed money to entrepreneurs and start-ups and attract venture capital funding in the emerging industry.

The Vision Group of the state government, which authored the first Millennium Biotech Policy and organised the Bangalore Bio 2003 event over the last three days, will be pushing the proposal as part of its Bangalore Declaration.

"The corpus will be based on the Israeli model, which promotes biotech start-ups by small companies or entrepreneurs with a seed capital from the government and ropes in venture capitalists to invest in start-ups.

"Normally, a biotech or bio-informatics start-up will be requiring Rs 4-5 million seed money to take up projects in clinical research or contract work. The projects can be in either drug discovery or genetically modified seeds for high-yielding crops," declared Vision Group chairperson and Biocon India managing director Kiran Mazumdar in Bangalore on Thursday.

In order to accelerate the growth of the industry, a biotech park is being developed by the state government in the electronics city on the outskirts of Bangalore with an investment of Rs 100 crore (Rs 1 billion).

"The park, christened Bangalore Helix, will have state-of-the-art facilities, including incubation centres and dedicated communication networks to enable faster setting up of start-ups," Mazumdar stated.