India's low private-sector share in R&D spending is a structural constraint on technological sovereignty. Critically examine how the ₹1 lakh crore RDI Fund seeks to address this.

India's Gross Expenditure on R&D (GERD) was just 0.64% of GDP in 2020-21. Firms contributed only 36% of it, whereas countries spending over 2% of GDP draw most R&D money from industry [4]. The ₹1 lakh crore RDI Fund, approved by the Cabinet in July 2025 for six years [2], targets this gap. Its design is sound, but its impact hinges on execution.

How the Fund addresses the constraint

• Patient capital: long-tenor, low/nil-interest loans and equity instead of grants, so money recycles into the corpus [3].
• Fund-of-funds design: a Special Purpose Fund within ANRF channels capital to Second Level Fund Managers (SLFMs), letting professionals, not ministries, pick firms [2].
• Crowding-in: SLFMs must mobilise private capital equal to the RDIF contribution. The first cohort of 19 SLFMs (14 AIFs, 5 Focused Research Organisations) carries ₹7,131 crore [1].
• Bridging the "valley of death": only enterprises at TRL 4 and above qualify. This is the lab-to-market stage that banks avoid for lack of collateral [1].
• Sovereignty focus: sunrise sectors such as AI, quantum, semiconductors, energy and biotech [2].

Limitations

• Commitment ≠ disbursement: the ₹7,131 crore committed [1] is under half of one year's average share (~₹16,700 crore) [2]. Science money often goes unspent: the research foundation's 2023-24 revised estimate was just ₹259 crore [4].
• Talent bottleneck: about 260 researchers per million, versus 1,602 in China [4], means few bankable TRL-4 projects.
• Deadweight risk: there is no additionality test, so cheap loans may reward firms already doing R&D instead of inducing new spending.
• Basic research excluded: TRL 1–3 depends on grant channels that remain underfunded [4], which thins the Fund's own project pipeline.
• Slow approvals: layered vetting (Expert Advisory Committee → ANRF Executive Council → EGoS) stretched a January 2026 call into an October 2026 cohort [1].

The RDI Fund rightly shifts India from grants to risk-sharing capital that pulls private money into strategic technology. DST should publish disbursement data for each SLFM, judge managers on private capital actually mobilised, and protect ANRF grants for basic research. Together these would advance the Draft STI Policy 2020 goal of doubling the private share of GERD [4] and SDG 9.5, helping India move from technology consumer to technology provider.