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.

https://www.pib.gov.in/PressReleasePage.aspx?PRID=2141130