Prime Minister Narendra Modi on Monday announced the launch of a ₹1 trillion Research, Development and Innovation (RDI) Fund to boost private sector-led research and technology development across India. The fund, unveiled during the Emerging Science, Technology and Innovation Conclave (ESTIC) 2025, marks one of the government’s most ambitious initiatives to institutionalise innovation financing and accelerate India’s transition into a global innovation hub.
Fund Structure and Governance
The Department of Science and Technology (DST) will act as the nodal ministry for the fund, which will operate through a two-tier structure:
- Special Purpose Fund (SPF): Managed under the Anusandhan National Research Foundation (ANRF), it will serve as the custodian of the ₹1 lakh crore corpus.
- Professional Fund Managers: The SPF will channel capital through alternate investment funds (AIFs), development finance institutions (DFIs), non-banking financial companies (NBFCs), and focused research organisations (FROs) such as the Technology Development Board (TDB), Biotechnology Industry Research Assistance Council (BIRAC), and IIT Research Parks.
Unlike traditional grant-based schemes, the RDI Fund will offer long-term, low-interest or interest-free loans, equity infusions, and allocations to deeptech fund-of-funds, targeting projects with transformative potential.
Focus on High-Impact Research Areas
The fund will prioritise “high-risk, high-impact” projects in critical and emerging domains including:
- Energy security and transition
- Quantum computing
- Artificial intelligence (AI)
- Robotics
- Space technology
- Biotechnology
Prime Minister Modi emphasised that the fund represents a paradigm shift in India’s innovation landscape.
“For the first time, capital is being allocated specifically for high-risk, high-impact projects, ensuring support for ground-breaking endeavours,” he said.
He added that the government is working to enhance the “ease of doing research”, creating a conducive environment for scientific and industrial collaboration.
Industry and Startup Reactions
The initiative has been widely welcomed by India’s startup and venture capital community.
Rajat Tandon, President of the Indian Venture and Alternate Capital Association, called the fund a “decisive step toward building India’s innovation capital framework.”
“It lays the foundation for a new era of public-private collaboration in research and technology, anchored in long-term, risk-taking patient capital,” he said.
Manu Iyer, General Partner at Bluehill.VC, noted that the fund will bridge the gap between early-stage research and commercial deployment.
“This empowers startups to take bigger risks in deep tech and frontier solutions while fostering collaboration among academia, industry, and entrepreneurs. Over time, this will accelerate the translation of research into commercialisation and strengthen India’s sovereign technology capabilities in space, defence, semiconductors, and biotech,” he said.
Governance Oversight
Second-level fund managers will make investment recommendations through independent investment committees comprising experts from financial, business, and technical domains, operating at arm’s length from the government to ensure transparency and merit-based allocation.
Summary:
The government’s ₹1 trillion RDI Fund aims to catalyse high-risk, high-impact innovation, empowering private enterprises, startups, and research institutions to drive India’s next wave of technological breakthroughs. With its unique public-private structure and focus on deeptech, AI, and energy transition, the initiative positions India to become a global leader in research-driven innovation.
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