FM Sitharaman Unveils Rs 100,000 Crore Fund to Boost R&D and Deeptech Ventures

By Consultants Review Team Thursday, 01 February 2024

In a significant move to foster innovation and technology development, Finance Minister Nirmala Sitharaman, during the presentation of the interim budget on February 1, announced the establishment of a substantial corpus aimed at enhancing research and development (R&D) in the private sector. Alongside this initiative, a separate scheme dedicated to supporting DeepTech ventures was also introduced, drawing positive responses from the country's tech startup ecosystem.

Highlighting the pivotal role of innovation in national development, Sitharaman declared, "For our tech-savvy youth, this will be a golden era." The proposed corpus, amounting to Rs 100,000 crore, will provide a 50-year interest-free loan, facilitating long-term financing or refinancing with extended tenors. This strategic measure is anticipated to stimulate heightened research and innovation activities within emerging domains.

The allocation of 50-year interest-free loans to young tech entrepreneurs has been hailed as a forward-thinking initiative, signifying the government's commitment to nurturing a robust technology ecosystem. Edul Patel, Co-founder and CEO of Mudrex, a crypto investing platform provider, emphasized the significance of this move, recognizing its potential to fortify private sector R&D growth.

According to Rohit Chouhan, CEO of Nabhdrishti Aerospace, the infusion of capital is particularly crucial for startups and small enterprises engaged in developing cutting-edge technologies for defense purposes. The protracted gestation period and significant upfront investment required for defense-related projects often pose challenges for such entities. Chouhan highlighted that the long-term, low-interest loans would enhance the resilience and competitiveness of local defense startups and businesses, enabling them to effectively compete on a global scale.

Nilaya Varma, Co-founder and CEO of Primus Partners, termed the fund as "most welcome" and emphasized its critical role in propelling India towards intellectual property-based growth, positioning the nation as a research and product-oriented entity. Varma highlighted the synergy between this fund, the Atmanirbharta initiative for the defense industrial complex, and the emphasis on quality education at premier institutions, envisioning India's transformation into a research and product-driven nation.

In her budget speech, Sitharaman underscored the expanding global opportunities for India, revealing plans for a new scheme aimed at fortifying DeepTech technologies for defense purposes and expediting the Atmanirbhartha (self-reliance) agenda. The move aligns with the 2023 announcement of India's first national DeepTech startup policy, focusing on interventions to support ventures commercializing products based on rigorous scientific research and engineering.

G.S. Madhusudan, Co-founder and CEO of Incore Semiconductors, emphasized the foundational importance of DeepTech in society, especially in critical areas like semiconductors. He stressed the need for self-sufficiency in such technological domains for a nation of 1.4 billion people, asserting that it is integral for societal stability.

Current Issue