An investigative report has revealed that 15 out of 22 private technology companies awarded soft loans under the inaugural cohort of India’s flagship Rs 1-lakh crore Research, Development and Innovation (RDI) Fund maintain active investment or institutional ties with seven members of the selection committee. While government officials and panel members emphasize that rigorous recusal protocols and first-come, first-served evaluation mechanics were strictly followed without any impropriety, the concentration of nearly 62 percent of first-round disbursements—totaling Rs 1,377 crore—among linked firms has sparked rigorous debate in Parliament over public sector fund governance, disclosure standards, and conflict-of-interest safeguards.
NEW DELHI — An investigation by The Indian Express has revealed that 15 out of 22 private tech enterprises selected to receive public soft loans from India’s newly established Rs 1-lakh crore Research, Development and Innovation (RDI) Fund have direct investment or business links to seven members sitting on the government’s evaluation committee.
The landmark RDI Fund was established by the central government in late 2025 to address structural financing deficits in high-risk, capital-intensive technology sectors. Designed to offer collateral-free, long-term loans at low interest rates, the initiative aims to catalyze private sector breakthroughs in critical domains including artificial intelligence, quantum technology, space science, defense, robotics, clean energy, semiconductors, and digital healthcare.
However, findings showing that 62 percent of the inaugural tranche—amounting to Rs 1,377 crore out of the total Rs 2,192 crore approved—was sanctioned to firms connected to committee members have prompted intense parliamentary inquiries and raised demands for enhanced institutional oversight.
Architecture and Operational Mechanics of the Rs 1-Lakh Crore Corpus
The RDI Fund operates as a dedicated Special Purpose Fund (SPF) under the administrative umbrella of the Anusandhan National Research Foundation (ANRF), a statutory body established under the Ministry of Science and Technology to mobilize research capital and bridge academia-industry divides.
Rather than issuing direct grants or acquiring public equity stakes, the fund disburses capital strictly through soft loans via designated Second-Level Fund Managers (SLFMs). Currently, two statutory and state-backed entities serve as SLFMs:
- The Technology Development Board (TDB), a statutory authority operating under the Department of Science and Technology.
- The Biotechnology Industry Research Assistance Council (BIRAC), a public sector enterprise under the Department of Biotechnology.
Additional managers, including private sector fund houses, are slated for integration in subsequent phases.
To qualify for capital, private applicants must demonstrate that their project has reached at least Technology Readiness Level 4 (TRL4)—meaning the underlying scientific process or product has been successfully validated in laboratory conditions. Approved entities, known as Eligible Technology Entities (ETEs), can secure loans covering up to 50 percent of total project expenses. These loans carry an annual interest rate of 2 to 4 percent with extended repayment tenures of up to 15 years, operating entirely without collateral requirements.
The evaluation process for ETEs is delegated to specialized Investment Committees formed by each SLFM. In the case of the Technology Development Board, the selection panel comprises 11 private-sector experts—spanning venture capitalists, angel investors, and industry executives—alongside one non-voting government official who acts as committee secretary. While final formal approvals rest with the overarching TDB Board, proposals rejected or unrecommended by the Investment Committee cannot proceed to disbursement.
First-Round Disbursements and Parliamentary Scrutiny
During the first application cycle conducted by the TDB, the board received 124 proposals from private technology firms. The Investment Committee evaluated 51 of these applications, ultimately selecting 22 companies for funding and sanctioning a aggregate total of Rs 2,192 crore. The remaining 73 initial applications, alongside newer submissions, remain under appraisal.
The investigation revealed that 15 of these 22 successful ETEs harbored investment ties with seven private-sector members on TDB’s 11-member Investment Committee.
The matter gained significant public visibility following a written submission in the Rajya Sabha by Minister of State for Science and Technology Jitendra Singh, responding to queries raised by Opposition MP Praveen Chakravarty. Minister Singh provided the names of seven panel members alongside 15 entities in which disclosures had been registered.
Among the panel members highlighted in the findings was Investment Committee Chairman Saurabh Srivastava, a prominent angel investor who was disclosed as having financial or advisor links to nine funded ventures, including personal equity positions in firms such as Noccarc Robotics. Other committee members identified in official records included executive leaders and venture partners associated with TVS Capital, Persistent Systems, and Tata Group entities.
In parliamentary proceedings, lawmakers questioned whether existing frameworks adequately guarded against potential bias when allocating substantial public funds, pressing for details on specific recusal protocols and calling for independent reviews.
Government Defense and Safeguard Frameworks
Following the publication of the investigative details, government officials and selection committee members forcefully defended the selection mechanics, maintaining that all sanctions were determined purely on technical and commercial merit.
Speaking at a news briefing in New Delhi, Rajesh Kumar Pathak, Secretary of the Technology Development Board, clarified the operational context and emphasized that conflict-of-interest policies were strictly enforced throughout the evaluation phase.
“There are comprehensive, layered safeguards built into this process that go far beyond standard voluntary disclosure,” Pathak stated firmly while addressing reporters in a crowded press room. “For instance, if a committee member holds any operational role, co-founder status, or direct ownership in an applicant entity, that entity is rendered entirely ineligible to apply, regardless of its technological merit. Furthermore, members are obligated to disclose both positive interests—such as equity shares—and negative interests, such as holdings in a direct competitor of an applicant.”
Pathak explained that the high concentration of linked firms in the first cohort stemmed primarily from early application dynamics rather than preferential treatment.
“Because the RDI Fund was initiated following extensive consultation with the domestic technology ecosystem, early-stage ventures connected to prominent tech investors were among the first to become aware of the scheme and submit applications,” Pathak noted. “Appraisals are conducted on a rolling, first-come, first-served basis. As a result, the initial batch displayed a disproportionate ratio.”
To substantiate this point, Pathak revealed preview figures for the upcoming second cohort scheduled for final approval on August 11, 2026. Out of 13 companies recommended in the second batch, only one entity maintains an investment link with a committee member.
He also underscored that the Investment Committee serves an advisory role. Final authorization must be granted by the full TDB Board, which is dominated by seven ex-officio senior government officials, including Secretaries from the Department of Science and Technology, the Defence Research and Development Organisation (DRDO), and the Department for Promotion of Industry and Internal Trade (DPIIT).
Panel members contacted during the investigation similarly confirmed that whenever an applicant firm in which they held a stake came up for review, the affected panellist formally declared the interest and completely exited the room, taking no part in scoring, deliberation, or voting. Panellists pointed out that in specialized sectors like deep-tech, experienced domain leaders chosen to evaluate high-risk innovations naturally possess broad investment footprints across the ecosystem.
Governance Reform Debates and Institutional Recommendations
Despite assertions that existing recusal guidelines were observed, governance analysts and policy experts have urged the Ministry of Science and Technology to incorporate additional structural guardrails to uphold public trust in the Rs 1-lakh crore initiative.
Proposed institutional reforms currently under discussion among policy experts include:
- Academic and Scientific Weighting: Structuring primary evaluation panels to feature a majority of independent academic researchers and scientists from premier research institutions, such as the Indian Institutes of Technology (IITs) and the Indian Institute of Science (IISc), before commercial valuations are conducted.
- Third-Party Financial Appraisals: Delegating loan quantum determinations and financial risk assessments to independent external audit firms following scientific clearance.
- Proactive Public Disclosures: Establishing online public portals where full conflict-of-interest declarations, member recusals, and scored evaluation summaries for all beneficiary firms are published transparently prior to loan disbursal.
As the RDI Fund prepares to expand its disbursal footprint through secondary fund managers like BIRAC and future private SLFMs, maintaining a transparent balance between expert industry participation and rigorous public accountability remains vital for India’s long-term deep-tech strategy.
