The China-based Chinese fund that raised $1 billion to fund Indian IT startups has provided valuable capital to some of the country’s fastest-growing startups and is helping to drive growth in some sectors of the economy.

While the fund has been lauded for its investment and investment quality, it has also faced criticism from some quarters for its reliance on overseas investors and its focus on China.

The fund, which was set up by the Shanghai-based State Council of Foreign Investment in India, has been described as a conduit for Chinese funds to fund foreign companies that do not operate in India.

The fund’s main investors are a group of Chinese investors including the China State Investment Corporation and the Shanghai Composite Fund Group.

Among the projects funded by the fund is the company, which makes virtual reality headsets, that is being developed in partnership with the Chinese state-owned tech firm Alibaba, said Amit Kumar Singh, a managing director of the Bengaluru-based venture capital firm CVC Capital.

It has also invested in the virtual reality firm Leap, which is being launched in India by the Chinese internet company Baidu.

In the last one-and-a-half years, the fund’s total investments have jumped from $500 million to $1,300 million.

In the last two years, it invested in more than 50 startups, said Mr Singh.

The State Council, which has the sole authority to issue permits to foreign investors in India and has been actively involved in funding tech projects, has made the fund a member of its investment advisory council and a member to its Investment Advisory Committee (IAC).

The fund has also raised more than $1 million from investors including Google Ventures, Andreessen Horowitz, Sequoia Capital and other tech giants, he said.

The group is also providing technical support to the IAC, he added.

The IAC was set-up by Prime Minister Narendra Modi and includes the State Council and its chairperson.

Mr Singh said that, from the first meeting, the two sides agreed to focus on promoting Indian technology companies and technology-based jobs.

The government is now looking at the IACA’s activities to further the Indian ecosystem, he told PTI.