Economic Times of India’s (ET) scoop that conglomerate Reliance Industries’ Jio Platforms is finalising a potential $200m commitment to domestic venture capital fund Kalaari Capital could be the signal for a wider local commitment and corporate venturing efforts.

The Mukesh Ambani-led conglomerate has reportedly closed a $100m first commitment, with an additional commitment of $100m planned for later as part the group’s plans to deepen its footprint in India’s tech scene, ET said.

Kalaari’s portfolio companies, such as furniture retailer Urban Ladder and lingerie retailer Zivame, were acquired by units of Reliance Industries, ET said, with a source adding: “Reliance’s investment in Kalaari will give the company an early line of sight into startups and upcoming sectors.

“RIL won’t necessarily acquire all the companies in which Kalaari invests, but it will certainly act as a discovery pipeline.”

In November, Reliance committed $50m to Breakthrough Energy Ventures primarily for international deals.

It is a scale-up from earlier commitments. In 2018, for example, a Reliance Industries subsidiary contributed to Indian venture firm 3one4 Capital $39.3m Fund II.

But there have been false dawns before. Back in 2016, Ambani said Reliance Industries would set up a Rs 50bn ($750m) corporate venturing fund to invest in digital technology developers.

At the time Ambani said: “We also have plans to partner with thousands of Indian entrepreneurs, whose digital ventures can bloom in the ground that Jio is preparing.”

Back in 2010, its Reliance Capital aimed for $500m fund and it made investments through two subsidiaries, Network18 and GenNext Ventures.

The difference potentially now is Reliance has itself raised tens of billions of dollars in the past year to fund Jio and transform itself from primarily an energy-focused conglomerate to a telecom and tech one.

In an emailed response to ET, a Reliance spokesperson said, “Reliance remains committed to supporting the build-up of a thriving startup ecosystem in India, particularly in digital enablement space, and will continue to explore various avenues to do so.”

Reliance’s commitment could also come at an important time for India’s ecosystem more widely.

Martin Haemmig, adjunct professor at Cetim, in his keynote at the GCV Digital Forum in January, noted GCV Analytics data showed about a 20% drop in both domestic-only and foreign-only CVC investment last year in India. (Chart below.)

This is different both from other Asia-Pacific countries and US/Europe. Gateway House’s report last year uncovered the importance of China to India corporate venture capital (CVC) deal activity. This was affected in the past year especially with the so-called techlash by politicians limiting Chinese tech companies in India.

That local CVCs reduced activity is unclear but would be a warning signal. You might expect a reduction in foreign-only deals in favour of hybrid deals as local CVCs become more active – this is generally seen as an important source of FDI (foreign-direct investment) and to help local entrepreneurs scale up globally.

That India has dropped from a relatively low base vis a vis China that has many more large deals would be concerning. The first generation of CVC champions in China – Baidu, Alibaba and Tencent – encouraged their portfolio companies, such as Didi Chuxing and Meituan Dianping, to scale up and start CVC quickly.

The tech incumbents in India, including Tata, Infosys and Reliance, have perhaps looked more internationally and to dominate local markets without local CVC in the main.

That Reliance is now supporting third-party VCs and acquiring portfolio companies will create a more dynamic ecosystem for startups alongside its own corporate venturing backers, such as search engine Google, giving it greater global heft.