To encourage innovation, IT industry body Nasscom and ICICI [Get Quote] Knowledge Park are setting up a $25 million venture capital fund to help startups that are in the intellectual property space. The fund -- to be registered with market regulator Sebi -- will look after the brick-and-mortar costs of startups. This is one of the initiatives, reveals Nasscom vice-president Rajdeep Sahrawat to Business Standard as the IT body is readying for the fourth edition of the Innovation Awards. Excerpts:

Well, tell more about the fund?

The initiative is placed where there the domestic market is large. India can become a leader in areas such as automotive infrotronics, medical devices, life sciences and green technologies.

We want large firms to contribute towards this growth. Regarding investments, the fund will target mainly the known-names in the industry.

We are already finalising anchor investors. Two names have been selected. Once the fund is registered with Sebi, Nasscom will start the registration process.

We may give a maximum of 15 per cent of the cost borne, while the lower limit is 5 per cent. The size of the fund throughout its life will be $50 million.

How is the government cooperating with Nasscom to promote innovation?

We are working with the government on innovation, policies and to make patenting easy, among others. India has been successful in building applications around technologies. However, our structural weakness is that we don't create enough technologies.  The core issue is IP in India. Creation of technology is imperative, hence IP.

What is new at the Innovation Awards this year?

We have the market-facing innovation category this year, aimed at the end-user. We have got 200 applications. Of these, 15 have been shortlisted -- five each in the large and medium segments, startups and emerging firms.

Three companies have been shortlisted in the process and input innovation categories each. On November 15, they will showcase their innovations in Delhi.

Besides, on November 17, all aspirants will display their innovations in Bangalore. The winners will be felicitated at the annual Nasscom Leadership Summit in Mumbai.

Other measures by Nasscom to encourage innovation?

There are specific initiatives. First, there is a need to create intellectual property.  True innovations take birth when the IT industry interacts with other industries -- for instance, strong user industries such as the automotive and wireless sectors.

In Pune and Chennai, we're working with the department of science and technology. In Pune, around the automotive industry and in Chennai, around the wireless industry.

We brought together leading user industries, IT companies such as TCS [Get Quote], Cognizant and Ericsson and the academia at a seminar in Pune. We had a workshop with IIT-Madras to promote the ecosystem.

What about small towns?

It is very romantic to talk about innovation only coming from small towns. If you look at some of the larger innovations, it's like a supply chain. You do need a certain amount of creativity to generate wild ideas, but to turn them into a successful commercial product, you need to work with larger firms.

Somebody has to be the creator and some one the executor. Ideas can come from anywhere but you do need a certain amount of infrastructure to be successful.

What are the core issues to be addressed?

We would like to focus on Ph.Ds in computer science. It is becoming a big worry. One of the successful ways for creation of innovation is through post-graduates. The US has a strong Ph.D programme. Basic technology is created through these research programmes. In India, we have a strange anomaly.

Though the IT industry is growing in India, the number of Ph.Ds in computer science is stagnating. It was 34 last year. We are looking at public-private partnerships so that we can have 1,000 Ph.D holders in the next four-six years.

Secondly, the salary structure of the industry and the absence of faculty. If it takes four years to get a substantial salary, who will opt for a Ph.D? We are working on this. There is a strong interest on the part the government on this. We have to start creating the technology, everything else will follow.