The government is reportedly finalising the framework for the Rs 1 trillion research, development and Innovation (RDI) fund announced in this year’s budget and approved by the Cabinet in July 2025. According to the secretary of Department of Science and Technology, the fund is expected to roll out by November 2025.
The RDI fund is expected to operate through a two-tier mechanism, with the department channelling financing via second-level fund managers rather than making direct investments. Venture capital funds, alternative investment funds, IITs, and the technology development board will play key roles in the process.
As per him, there will be no upper cap on ticket size, allowing large conglomerates to participate provided they contribute their fair share of investment. The fund is being structured to enable faster approvals, with the goal of bridging India’s research and development (R&D) spending gap. While private sector spending accounts for 70 per cent of gross R&D expenditure in advanced economies, it stands at only 30-35 per cent in India. By de-risking early-stage ventures and offering patient capital, the RDI fund aims to shift this balance.
The secretary also highlighted India’s opportunity to strengthen indigenous capabilities in the global technology landscape. He cited progress under the National Quantum Mission (NQM), which has established four thematic hubs focused on quantum computing, sensing, materials and devices, and communications. These hubs are working with a national network of institutions and researchers to build both academic and commercial applications.
Eight start-ups were funded in the first NQM cohort, and applications for the second cohort are now being accepted on a rolling basis.
The broader objective of the RDI fund is to promote private sector participation in R&D, reduce reliance on foreign technologies, and accelerate the development of critical areas such as quantum systems and artificial intelligence models.
