New Delhi, July 1 The Union Cabinet, chaired by Prime Minister Narendra Modi, on Tuesday approved Rs 1 lakh crore for the Research Development and Innovation (RDI) scheme, aimed at transforming the private research and innovation ecosystem in the country.
"The RDI scheme aims to provide long-term financing or refinancing with long tenors at low or nil interest rates to spur private sector investment in RDI," a Cabinet communique said.
The approval comes as the government recognised the critical role of the private sector in driving innovation and commercialising research.
"The scheme has been designed to overcome the constraints and challenges in the funding of the private sector and seeks to provide growth and risk capital to sunrise and strategic sectors to facilitate innovation, promote adoption of technology and enhance competitiveness," the communique said.
The scheme will encourage the private sector to scale up RDI in sunrise domains and in other sectors relevant to economic security, strategic purpose, and self-reliance.
It will help boost finance transformative projects at higher levels of Technology Readiness Levels (TRL) and support the acquisition of technologies critical or of high strategic importance. The scheme will also help facilitate the setting up of a deep-tech fund of funds, the communique said.
The strategic direction of the RDI Scheme will be undertaken by the governing Board of the Anusandhan National Research Foundation (ANRF).
The scheme’s guidelines will be approved by the Executive Council (EC) of the ANRF. The EC will also recommend second-level fund managers and the scope and type of projects in the sunrise sectors.
Further, an Empowered Group of Secretaries (EGoS) led by the Cabinet Secretary, will be responsible for approving scheme changes, sectors, and types of projects as well as second-level fund managers. They will also review the performance of the scheme.
The Department of Science and Technology (DST) will serve as the nodal department for the implementation of the RDI Scheme.
The RDI Scheme will have a two-tiered funding mechanism: a Special Purpose Fund (SPF) and long-term concessional loans.
The SPF established within the ANRF will act as the custodian of funds, which will be allocated to a variety of second-level fund managers. This will be mainly in the form of long-term concessional loans, the communique said.
The funding for research and development projects by the second-level fund managers would normally be in the form of long-term loans at low or nil interest rates.
Financing in the form of equity may also be done, especially in the case of startups. Contribution to Deep-Tech Fund of Funds (FoF) or any other FoF meant for RDI may also be considered.
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