In a landmark move to catalyse India’s innovation-driven economy, the Union Cabinet chaired by Prime Minister Narendra Modi has approved the Research Development and Innovation (RDI) Scheme with a massive outlay of INR 1 lakh crore.
Designed to address the persistent funding gaps in private-sector R&D, the RDI Scheme will provide long-term financing or refinancing support at low or zero interest rates. It seeks to unlock investments in sunrise domains and strategically significant technologies by offering growth and risk capital through a structured mechanism. The scheme also encourages the creation of a Deep-Tech Fund of Funds to promote cutting-edge research and development.
The key objectives of the RDI Scheme include:
- Encouraging private sector participation in high-impact RDI across emerging and strategic areas
- Financing transformative projects at advanced Technology Readiness Levels (TRLs)
- Supporting the acquisition and development of critical technologies
- Enabling the setup of a deep-tech fund ecosystem to nurture breakthrough innovation
The scheme will be governed by the Anusandhan National Research Foundation (ANRF), with the Prime Minister chairing its Governing Board. The Executive Council (EC) of ANRF will formulate guidelines, approve projects, and recommend fund managers. Oversight will be provided by an Empowered Group of Secretaries (EGoS) led by the Cabinet Secretary, ensuring policy agility and performance monitoring. The Department of Science and Technology (DST) will serve as the implementing nodal agency.
A two-tier funding architecture will anchor the scheme. The Special Purpose Fund (SPF) under ANRF will function as the central repository of funds. It will disburse resources to various second-level fund managers for onward investment into eligible projects, primarily in the form of long-term concessional loans. Startups and deep-tech ventures may also be supported through equity investments. Contributions to dedicated Funds of Funds focused on RDI will also be facilitated.
By targeting affordable, long-duration capital towards the private sector, the RDI Scheme aims to bridge the funding gap in innovation, enhance technological self-reliance, and bolster India’s competitiveness in strategic sectors. This marks a decisive step towards building a resilient, innovation-first economy aligned with the vision of Viksit Bharat by 2047.
Featured photo is representational.
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