A newly operational public fund designed to accelerate India’s deep-technology capabilities has approved Rs 2,192 crore in soft loans to 22 private companies in its first round of disbursements. An examination of the awards has shown that 15 of these firms have investment or other financial links to seven members of the committee that selected them. Those 15 companies together received more than Rs 1,377 crore—approximately 62 per cent of the total amount cleared.
The Fund and the First Round
The money forms part of the Research, Development and Innovation (RDI) Fund, a large public initiative launched to support private-sector work in strategically important technology areas. The Technology Development Board under the Ministry of Science and Technology is one of the bodies tasked with identifying suitable recipients. In the opening round, 124 companies applied. A 12-member Investment Committee—comprising 11 experienced figures from private equity and technology and one non-voting government representative—chose 22 firms working in fields that include space science, energy technology and pharmaceuticals.
The loans are intended as soft financing to help promising deep-tech ventures scale. Because the capital is public, the process of selection carries heightened expectations of transparency and fairness.
Links Between Recipients and Selectors
Investigative reporting based on corporate filings, parliamentary records and publicly available company information established that 15 of the 22 successful applicants have ties to seven members of the selection committee. These ties take the form of investments by funds associated with the members, directorships, or personal stakes in the companies concerned. Nine of the firms are linked to the chairman of the panel, who is associated with a well-known angel investing network and holds a personal interest in at least one of the selected companies.
The concentration of awards—nearly two-thirds of the total value—among companies connected to sitting committee members has prompted questions about conflict of interest and the adequacy of existing safeguards.
Disclosure and Recusal
Members of the committee have stated that they disclosed their financial interests in the relevant companies and recused themselves from the decision-making process in those cases. Parliamentary records confirm that the Science and Technology Minister, in a written reply, listed the seven members who had declared such interests. Officials have indicated that the committee followed the conflict-of-interest policy in place and that decisions were taken on the basis of technical and commercial merit by members without conflicting stakes.
Disclosure and formal recusal are standard tools for managing conflicts in investment and grant-making bodies. The question raised by critics is whether these steps are sufficient when the capital being allocated belongs to the public and when a high proportion of the funding flows to entities connected to the decision-makers.
Parliamentary Scrutiny
The matter was brought to the attention of Parliament by Congress Rajya Sabha MP Praveen Chakravarty. He has argued that because public money is involved, stronger institutional guardrails are required. In his view, the combination of a private-sector-dominated selection panel and a large share of awards going to linked firms creates an appearance of impropriety even if formal procedures were observed. The call is for clearer rules that reduce the scope for such overlaps or that introduce additional independent checks before large public soft loans are cleared.
Why the Numbers Matter
Soft loans from a sovereign fund carry advantages that private capital may not always provide—preferential terms, longer horizons, or strategic signalling. When a substantial majority of the first-round money reaches companies already connected to the people choosing the recipients, two concerns arise. The first is whether equally or more deserving applicants without such connections received a fully level evaluation. The second is whether public confidence in the fund’s integrity can be maintained if the pattern continues in subsequent rounds.
Deep-tech investing is inherently specialised. Expertise from active investors and industry veterans is valuable precisely because they understand technical risk and market pathways. The challenge for any public programme is to harness that expertise without allowing prior commercial relationships to shape the flow of government capital in ways that appear self-reinforcing.
Broader Context of Public Deep-Tech Support
India has expanded public support for research, startups and strategic technologies in recent years. Funds of this scale are meant to crowd in private investment, de-risk early commercialisation and build domestic capability in areas considered critical for economic and security reasons. Their legitimacy rests on the perception that awards are driven by national priorities and project quality rather than by networks already represented on the selection bodies.
The RDI Fund’s first round therefore serves as an early test. The government and the Technology Development Board will be expected to demonstrate that future cycles incorporate tighter processes—whether through broader independent review, stricter cooling-off rules, or more detailed public disclosure of evaluation criteria and scoring—so that both the substance and the appearance of fairness are protected.
Balancing Expertise and Accountability
No one disputes the need for domain knowledge on committees that allocate sophisticated technology funding. The issue is how to structure decision-making so that expertise does not translate into preferential access for a small circle of connected ventures. Disclosure and recusal address the most direct form of conflict. Additional mechanisms—such as independent technical audits of shortlisted proposals, greater transparency around rejected applications, or limits on the proportion of funding that can flow to entities linked to any single panel member—could further strengthen the system.
The MP who flagged the matter has framed the core principle simply: it is public money, and therefore the process requires robust guardrails. How the Ministry of Science and Technology and the fund’s administrators respond to that expectation will shape confidence in one of the country’s more ambitious attempts to finance deep technological capability through the private sector.
The Rs 2,192 crore already cleared will now be put to work by the 22 chosen companies. The larger test is whether subsequent rounds can distribute opportunity more widely while still drawing on the knowledge of those who understand the technologies best.
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