Context:
The Union Cabinet has today approved the Research Development and Innovation (RDI) Scheme with a corpus of Rs. One lakh crore.
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- 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.
- The scheme aims to address funding gaps in the private sector by providing growth and risk capital to boost innovation, technology adoption, and competitiveness in sunrise and strategic sectors.
- The RDI Scheme fosters self-reliance and global competitiveness, thereby facilitating a conducive innovation ecosystem for the country as it marches towards Viksit Bharat at 2047.
Key Objectives of the Scheme
- Promote private sector R&D and innovation in sunrise sectors and areas critical to economic security, strategy, and self-reliance.
- Finance transformative projects at higher levels of Technology Readiness Levels (TRL).
- Support the acquisition of technologies that are critical or of high strategic importance.
- Facilitate the setting up of a Deep-Tech Fund of Funds.
Governance Process
- The Governing Board of Anusandhan National Research Foundation (ANRF), chaired by the Prime Minister, will provide overarching strategic direction to the RDI Scheme.
- The Executive Council (EC) of ANRF will approve the Scheme’s guidelines, and recommend 2nd-level fund managers and the scope and type of projects in the sunrise sectors.
- 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, besides reviewing the performance of the Scheme.
- Nodal Agency: The Department of Science and Technology (DST) will serve as the nodal department for the implementation of the RDI Scheme.
Funding Mechanism
- At the first level, there will be a Special Purpose Fund (SPF) established within the ANRF, which will act as the custodian of funds.
- From the SPF funds shall be allocated to a variety of 2nd level fund managers. This will be mainly in the form of long-term concessional loans.
- 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.
- Financing in the form of equity may also be done, especially in case of startups.
- Contribution to Deep-Tech Fund of Funds (FoF) or any other FoF meant for RDI may also be considered.