Government’s Mega Push - India Unveils ₹99,771 Cr RDI Scheme to Supercharge Deep Tech and R&D Innovation

July 3, 2025 – On July 1, 2025, the Union Cabinet authorised the ₹99,771 crore (₹1 lakh crore / US$11.65 bn) Research, Development & Innovation (RDI) Scheme as part of a major effort to improve India’s innovation environment. This historic project is a strategy change that aims to increase private sector investment in research and development and improve technology skills through long-term, low- or no-interest loans from the Anusandhan National Research Foundation. India only spends around 0.64% of its GDP on research and development right now. This is much less than the U.S., Japan, and China, who spend between 2% and 5%.

People in the industry and experts have praised the program, calling it a “game-changer” for deep-tech investment and a necessary step to fill gaps in private-sector R&D spending. The plan could greatly improve India’s tech preparedness, commercialisation outcomes, and global competitiveness before its Viksit Bharat 2047 vision by focusing on sunrise industries, including AI, clean energy, biotech, quantum, climate tech, and space.

Anusandhan National Research Foundation (ANRF) to Lead Disbursement

The RDI Scheme sets up a Special Purpose Fund (SPF) under the ANRF to provide money to second-tier fund managers who will use it to make long-term concessional loans and equity investments, especially in startups and deep-tech companies. It will also help set up a Deep-Tech Fund of Funds to help new technologies grow. The project will be run by the ANRF Board, which is directed by the Prime Minister. An Empowered Group of Secretaries, led by the Cabinet Secretary, will be in charge of operational clearances. The DST will be the main agency in charge of carrying out the project. The ANRF will receive interest-free loans over a 50-year period, which will then be distributed as concessional loans to second-tier fund managers such as:

• Alternative Investment Funds (AIFs)
• Non-Banking Financial Companies (NBFCs)
• Development Finance Institutions (DFIs)

These institutions will finance research projects, especially those with long gestation periods, helping convert deep-tech ideas into viable commercial solutions.

Industry Backs Blended Finance Approach

Industry leaders have hailed the scheme for its blended finance model, which balances public support with private sector execution.

• Siddarth Pai, Founding Partner at 3one4 Capital, and
• Anjali Bansal, Founder of Avaana Capital,
  emphasised its potential to encourage domestic lab setups by global Indian talent and support the commercialisation of cutting-edge technologies.

They also highlighted the importance of:

• Grant-based funding
• Infrastructure such as single-window laboratory clearances
• Commercialisation support for startups and academia

Bridging the Innovation Readiness Gap

Ajai Chowdhry, Founder of HCL and Chairman of the EPIC Foundation, underscored the role of the scheme in bridging the Technology Readiness Level (TRL) gap. Currently, public institutions bring innovations up to TRL-4, but lack the resources to scale to TRL-9, which is where private sector participation becomes crucial.

Industry Seeks Clarity and Inclusivity

While the initiative has been widely welcomed, several stakeholders have expressed the need for:

• Greater industry representation on the ANRF’s governing board
• Inclusion of global R&D experts, rather than limiting leadership to bureaucrats and academics
• Detailed clarity on fund allocation criteria and disbursement timelines

Outlook

The RDI scheme marks a bold and ambitious attempt by the Indian government to transform the nation into a global R&D powerhouse. By empowering financial intermediaries and fostering collaboration between public institutions and private players, it aims to build a self-reliant and innovation-led economy. Industry players now await further guidelines on execution and governance to ensure its effective rollout.

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