The Union Cabinet chaired by Prime Minister Narendra Modi has greenlit the Research Development and Innovation (RDI) Scheme, allocating a substantial ₹1 lakh crore. This ambitious initiative seeks to transform India’s research landscape by incentivising private sector investments in advanced, strategic, and high-tech domains vital to national interests.

The RDI Scheme aims to dismantle the financial barriers that often deter private enterprises—particularly startups—from investing in high-risk, deep-tech research. It will offer highly concessional, long-term loans (including low or even zero interest rates) and equity support to encourage private firms to pursue breakthrough technologies and enhance India’s global competitiveness.

Key objectives of the scheme include significantly scaling up private R&D in emerging “sunrise” sectors, advancing high-tech projects nearing commercialisation, and enabling Indian companies to build or acquire critical technologies. A dedicated Deep-Tech Fund of Funds will also be established to back startups and ventures developing cutting-edge solutions.

The scheme features a robust governance structure to ensure effective oversight. The Anusandhan National Research Foundation (ANRF), chaired by the Prime Minister, will provide strategic direction. Its Executive Council will manage implementation details. Operational decisions, such as sector approvals and selection of second-level fund managers, will be handled by an Empowered Group of Secretaries led by the Cabinet Secretary. The Department of Science and Technology (DST) will serve as the nodal agency supervising ground-level execution.

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The funding framework comprises two tiers. Under ANRF, a Special Purpose Fund will be set up, channeling resources to chosen second-level fund managers. These managers will deploy the funds as long-term concessional loans or equity investments to ensure flexibility for R&D-heavy initiatives. Contributions to Deep-Tech Funds and other innovation-focused platforms will also be allowed under the scheme.

This bold initiative is widely seen as a strategic step towards reducing India’s technological dependencies, boosting self-reliance in critical technologies, and realising the vision of ‘Viksit Bharat’ by 2047 by providing the private sector with accessible, long-term financing for innovation.

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