Research, Development and Innovation (RDI) scheme a major boost for Research and Development (R&D) and deep tech in India: Industry

The Union Cabinet’s approval of the Rs. 99,771 crore (US$ 11.65 billion) Research, Development and Innovation (RDI) scheme is expected to boost India’s research and deep-tech investment landscape significantly. With India currently spending just 0.64% of Gross Domestic Product (GDP) on Research and Development (R&D), far below the 2–5% allocation by countries such as the United States (US), Japan, and China, the new fund is seen as a strategic intervention. The scheme, announced in the July 2024 Budget, will channel interest-free loans over 50 years to the Anusandhan National Research Foundation (ANRF), chaired by the Prime Minister, Mr. Narendra Modi. ANRF will then disburse concessional loans to second-tier fund managers, including Alternative Investment Funds (AIFs), Non-Banking Financial Companies (NBFCs), and Development Finance Institutions (DFIs), who in turn will finance research projects.
Industry leaders, including Founding Partner of 3one4 Capital, Mr. Siddarth Pai, and Founder of Avaana Capital, Ms. Anjali Bansal, welcomed the scheme’s blended finance approach, citing its potential to fund longer-gestation deep-tech ventures and attract Indian global talent to set up labs domestically. He emphasised the importance of grant funding, commercialisation support, and infrastructure such as single-window lab clearances. Founder of HCL and chairman of the EPIC Foundation, Mr. Ajai Chowdhry, noted the scheme’s role in bridging the gap between technology readiness levels, where institutions bring innovations to Technology Readiness Level (TRL- 4) and private players scale it to TRL-9. While enthusiasm is high, industry players have voiced concerns over the composition of the ANRF’s governing board, urging inclusion of industry leaders and global experts instead of only bureaucrats or academics. The industry awaits further clarity on fund allocation criteria and disbursement timelines.

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