Private equity (PE) and venture capital (VC) funds in India have tightened their purse strings. That’s because limited partners (LPs) – the main source of funding for venture capitalists — are reducing their exposure in this space. As per industry estimates, there has been a drop in new investments to the tune of 71% during the first nine months of 2009 as compared to the same period last year. Industry observers say limited partners are miffed with the returns shown by the general partners, who manage the fund and its operations on a daily basis, say industry observers. “Clearly, many LPs are looking at better returns and shorter investment term cycles,” says Sameer Mehta of Atlas Advisory. […]