MICROCAPITAL STORY: Cisco, SIDBI and TREC-STEP Partner to Create ICT Entrepreneurship Pilot Project in Tamil Nadu, India

A unique information and communications technology (ICT) entrepreneurship development programme will be launched in the Tamil Nadu state in the South-eastern part of India. The project will be run through a partnership between Cisco Systems, the Small Industries Development Bank of India (SIDBI) and Tiruchirappalli Regional Engineering College-Science and Technology Entrepreneurs Park (TREC-STEP). Each partner will play an active role in the pilot programme, with SIDBI providing finance to small ICT businesses in India which will be run by former and current Cisco Networking Academy students. Cisco will subsidize the interest repayment and guarantee fees on the loans and TREC-STEP will provide customized training and mentoring to participants.

The project is being developed as part of the USD 1 million that CISCO committed in 2006 to promote microfinance and ICT entrepreneurship. The pilot programme will initially involve ten ICT businesses in Tamil Nadu and, if successful, it will be replicated in further developing economies in which Cisco operates. The entrepreneurs will be provided loan assistance by SIDBI on flexible terms in order to increase the chances of success for entrepreneurs.

The Cisco Networking Academy Program is a public-private partnership between Cisco Systems, education, business, government and community organisations around the world, aimed at nurturing IT professionals. Since 1997, Networking Academy has grown to reach a diverse population of approximately 600,000 students each year in more than 160 countries and in India, there are over 150 Cisco Networking Academies across 22 states and union territories. There are currently 48 of these academies in Tamil Nadu. The Networking Academy program trains students from high school to graduate level in basic as well as advanced IT skills.

SIDBI was established in 1990 as the principal financial institution for the promotion, financing and development of small scale industry through The Small Industries Development Bank of India Act, 1989. MicroCapital has covered its partnership with Industrial Credit and Investment Corporation of India (ICICI) as well its investments in SKS Microfinance. Its assets stood at Rs. 219 billion (USD 4.3 billion) reported in its unaudited financial results for September 2008.

TREC-STEP is a training, development and consulting institution established in 1986. It focuses on the promotion of knowledge based industries, the development and transfer of technologies, training in technology and business skills and new development and project initiatives. TREC-STEP has been awarded a number of Indian and International recognitions, including the 2006 International Champion of Business Award from UK Business Incubation and Best Innovation Award 2003 from Indian Railways.

Cisco was founded in 1984 by a small group of computer scientists from Stanford University. Cisco hardware, software, and service offerings are used to create internet solutions which make networks possible. Since the company’s inception, Cisco engineers have been leaders in the development of Internet Protocol (IP) based networking technologies. Cisco Systems India Pvt Ltd. began operations in 1995 and currently has seven offices in the region with over 4000 employees and India has over 73 thousand Cisco Certified Professionals. Total assets for Cisco stood at USD 58.7 billion.

By Lori Curtis, Research Assistant

Additional Resources:

Cisco: “Home” “Networking Academy” “2008 Financial Highlights” “Corporate Overview”

The Economic Times: “Cisco to incubate entrepreneurs in three-way tie-up”

MicroCapital Story: “Indian ICICI Lombard General Insurance Allies with the Small Industries Development Bank of India (SIDBI) to Include Non-Life Insurance in its Microfinance Sector”

MicroCapital Story: “SKS Microfinance Raises $75.4m in Equity Capital in Transaction Led by Sandstone Capital”

MicroCapital Story: “Small Industries Development Bank of India (SIDBI) Makes over $220,000 Microfinance Equity Investment in SKS Microfinance”

New Kerala: “Introduces pilot in Tamil Nadu to provide loans and support to ICT businesses

Small Industries Development Bank of India (SIDBI): “Home” “History” “Financial Results September 2008”

TREC-STEP: “Home” “About Us“