Brief Context
Context The Union Cabinet has approved the Research Development and Innovation (RDI) Scheme with a corpus of Rs. One lakh Crore. Need For the Scheme The 2024-25 Economic Survey noted that even though India has increased the gross expenditure on research and development (GERD) from approximately ₹60,196 crore in 2011 to about ₹127,381 crore in 2021, it still is a mere 0.64% of the GDP.
Source Content
Syllabus: GS3/Science and Technology
Context
- The Union Cabinet has approved the Research Development and Innovation (RDI) Scheme with a corpus of Rs. One lakh Crore.
Research Development and Innovation (RDI) Scheme
- Key Objectives:
- Promote private sector investment in RDI, especially in areas of economic security and strategic relevance;
- Support transformative projects at higher Technology Readiness Levels (TRLs);
- Support acquisition of technologies which are critical or of high strategic importance;
- Facilitate creation of a Deep-Tech Fund of Funds (FoF) to support deep-tech innovations and startups.
- Institutional Framework:
- Governing Board (Anusandhan National Research Foundation (ANRF): Chaired by the Prime Minister, provides overall strategic direction.
- Executive Council (ANRF): Approves scheme guidelines, identifies projects and fund managers.
- Empowered Group of Secretaries (EGoS): Chaired by the Cabinet Secretary, oversees implementation, reviews performance, and approves changes.
- Nodal Department: Department of Science and Technology (DST).
Two Tired Funding Mechanism under the Scheme
- The government will channel ₹1 lakh crore to the Anusandhan National Research Foundation (ANRF) as a 50-year interest-free loan.
- Special Purpose Fund (SPF): Created under ANRF, it acts as custodian of funds. From the SPF funds shall be allocated to a variety of 2nd level fund managers.
- Second-Level Fund Managers: Receive concessional long-term loans or equity from SPF to fund R&D projects.
- The funding to R&D projects by the 2nd level fund managers would normally be in the form of long-term loan at low or nil interest rates.
- They will evaluate and select individual projects for funding, through both equity and debt
- Forms of Financing: Long-term concessional loans (primary mode).
- Equity financing (especially for startups).
- Contributions to Deep-Tech Fund of Funds.
Need For the Scheme
- The 2024-25 Economic Survey noted that even though India has increased the gross expenditure on research and development (GERD) from approximately ₹60,196 crore in 2011 to about ₹127,381 crore in 2021, it still is a mere 0.64% of the GDP.
- The survey noted that this remains “insufficient and remains low compared to many countries that have forged ahead in R&D”.
Significance
- Addresses financial constraints of private R&D in India.
- Boosts innovation in sunrise sectors (e.g., AI, semiconductors, clean energy).
- Aligns with the vision of Viksit Bharat@2047 by building a robust innovation ecosystem and promoting self-reliance.
Source: PIB