Evaluate whether the RDI Fund and the Anusandhan National Research Foundation can fix India's low private-sector share in R&D spending.

India's Gross Expenditure on R&D (GERD) is only about 0.65% of GDP, against about 3.5% in the US and 4.5% in South Korea [1]. The private sector's share of it rose only from 32.1% (2010-11) to 36.8% (2017-18) [2]. The ANRF Act, 2023 (in force from 5 February 2024) [3] and the ₹1 lakh crore RDI Scheme [4] are meant to change this. They are necessary, but on their own they are not enough.

How they can help

• Patient capital: the RDI Scheme offers long-term, low-interest financing for private R&D in sunrise and strategic sectors over six years [4]. This lowers the cost of capital, one of the main reasons firms avoid R&D.
• Market-based delivery: a Special Purpose Fund within ANRF passes money through second-level fund managers such as AIFs, DFIs, NBFCs, BIRAC and TDB [5]. Projects are picked by professionals rather than by bureaucrats, and private co-investment is drawn in. The government describes this as equity participation alongside private players [6].
• Institutional anchor: ANRF gives one apex body for setting priorities and linking academia with industry [3]. This reduces fragmented funding.

Why they fall short

• Scale: public funding still makes up about 64% of R&D spending, and NITI Aayog wants GERD raised to at least 2% of GDP [1]. ₹1 lakh crore spread over six years cannot close that gap alone.
• TRL 4+ restriction: only projects at Technology Readiness Level 4 and above qualify [4]. Early-stage work, such as sensors for 6,000 m ocean depths, is excluded. The fund commercialises science but does not create the pipeline of science that comes before.
• Demand gap: firms invest when there is a buyer. For example, India's seabed mineral activity under the ISA is limited to exploration only [7]. This leaves private returns from deep-sea technology uncertain.
• Loans, not grants: firms with little R&D culture may not borrow for risky research.

Verdict: the two can partly fix the problem. They address the supply of finance, not research culture, market demand or early-stage science.

Way forward: ANRF grants for work below TRL 4; public procurement as a guaranteed early buyer; R&D tax incentives; clear rules in emerging sectors. Together with NITI Aayog's goal that the private sector fund half of the targeted GERD [1], such a package can make the RDI Fund and ANRF the core of a self-sustaining, industry-led innovation system for Viksit Bharat 2047.