India’s ₹1 lakh crore Research, Development and Innovation Fund has come under scrutiny after an investigation found links between several recipient companies and members of the panel involved in selecting projects for the first allocation.
The RDI Fund was created to support long-term private-sector research and development in strategic technologies, including deeptech, space, quantum computing, artificial intelligence, biotechnology, pharmaceuticals and energy. The government approved the scheme in July 2025, with a total outlay of ₹1 lakh crore over six years.
The first allocation through the Technology Development Board involved 22 projects with total RDI support of ₹2,192 crore. The government said the projects had a combined project cost of ₹4,744 crore. TDB received ₹500 crore from the RDI Fund in March 2026 for investment in eligible technology entities.
An investigation by The Indian Express found that 15 of the 22 companies selected in the first cohort had investment or other financial links to seven members of the TDB Investment Committee. The investigation said those companies received more than ₹1,377 crore, raising questions about potential conflicts of interest and the appearance of impartiality.
The issue does not establish that any funding decision was improperly influenced. The committee members said they had disclosed their interests and recused themselves from discussions and decisions involving companies with which they had conflicts.
The Department of Science and Technology also said the selections were made purely on merit and that conflicted members had no involvement in the evaluation or sanction process for the affected proposals. The government has maintained that the RDI framework contains conflict-of-interest safeguards.
The concern is particularly relevant because the RDI Fund uses public money to support technologies that can take years to develop and commercialise. The government’s own guidelines allow financing of up to 50% of an assessed project cost, with the remaining amount expected to come from the project company or commercial sources.
The fund is designed to address a longstanding financing gap for Indian deeptech companies. Unlike conventional startups, many deeptech businesses require substantial research spending, specialised infrastructure and long development periods before they generate significant commercial returns.
The first cohort includes companies working across areas such as space technology, energy, semiconductors, healthcare and advanced manufacturing. The government said TDB had received 124 project proposals representing more than ₹25,000 crore in project demand before selecting the first 22 companies.
The government has also created a second-level funding structure under which organisations such as TDB and the Biotechnology Industry Research Assistance Council channel RDI money to eligible technology companies and projects. As of July, the government said TDB and BIRAC had each been sanctioned ₹1,000 crore under the scheme.
The scale of the programme means questions around transparency are likely to remain important as more fund managers and investment vehicles are brought into the system. The government said 162 applications had been received from alternative investment funds and 38 from focused research organisations seeking to participate as second-level fund managers, with proposals worth about ₹8,000 crore under consideration.
Supporters of the scheme argue that experienced investors and technology executives are needed to assess highly specialised businesses that government officials alone may not be equipped to evaluate. At the same time, the controversy has renewed debate over whether public funding committees should have additional safeguards when members have commercial connections to companies seeking support.
For the RDI Fund, the immediate challenge is to preserve its ability to deploy capital quickly while maintaining a selection process that is transparent and demonstrably independent.
The government is expected to expand the network of second-level fund managers and participating funds as the scheme moves beyond its initial allocation. How those future selections are structured will determine whether concerns over conflicts of interest remain a recurring issue or are addressed through stronger disclosure and recusal mechanisms.
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