Deeptech Investors Seek Transparency in India's RDI Fund Amid Conflict Concerns

India's ₹1 Lakh Cr Research, Development and Innovation (RDI) fund, intended as a catalyst for its deeptech sector, is facing scrutiny following its first major allocation. Concerns have arisen regarding alleged ties between recipient companies and members of the fund's investment committee (IC), prompting calls for greater transparency and oversight.

Reports indicate that 15 of the 22 companies receiving ₹2,192 Cr in the first round had investment links with seven of the 12 IC members. These companies, including Tejas Networks and Ather Energy, accounted for over ₹1,377 Cr, or approximately 62% of the approved amount. While IC members have stated they disclosed interests and recused themselves where necessary, and the government maintains no rules were violated, industry players are raising questions.

Concerns have been voiced that the fund's structure might favor established, well-capitalized ventures, potentially disadvantaging newer players. The fund's two-tier implementation, managed partly through the Technology Development Board (TDB), has also come under discussion regarding its accessibility and fairness.

Deeptech investors and ecosystem participants are questioning whether prior disclosure and recusal are sufficient when industry insiders are involved in allocating public capital. The emerging concern is that the government-backed fund could inadvertently reinforce existing hierarchies by favoring established investors and companies with strong networks, rather than fostering a broader pool of talent and innovation.