Budget 2024: Government plans Rs 1 lakh crore corpus for Research and Development
In her Interim Budget speech, Finance Minister Nirmala Sitharaman expressed a dedication to fostering research and innovation among India's tech-savvy youth. She highlighted a fund of Rs 1 lakh crore, offering 'minimal or nil interest rates,' aiming to incentivize the private sector's engagement in research and development within emerging sectors. The specific ministry or the broader scope of the encouragement to research was not explicitly outlined.
Experts said that while it is a “welcome” development, it remained to be seen how the scheme would be implemented. “There are many possibilities at this juncture but I’m not aware of any specific discussions [on beneficiaries and implementation] and the ministries which will be involved. However, it is very good as it envisages both the public and private sector to invest in research and development", V.K. Saraswat, Member, NITI Aayog (science and technology), said.
Among the significant steps taken by the Science Ministry in 2023 was clearing the National Research Foundation Bill. To be piloted by the Department of Science and Technology (DST), this envisages an autonomous body with a corpus of Rs 50,000 crore, of which nearly Rs 36,000 crore will come from the private sector and non-governmental sources. A major long-standing concern of the government has been in getting private sector enterprises to invest in core research and development, with nearly three-fourth of such R&D expense now borne by the government. The DST has provisioned Rs 2,000 crore in 2024-25 towards the NRF.
The relationship between the new corpus and the NRF remains uncertain. Allocations to civilian science departments, including the DST, the Department of Biotechnology, the Council of Scientific and Industrial Research, and the Ministry of Earth Sciences (MoES), showed modest increases. The CSIR received a 10% raise, going from Rs 5,746 crore in the 2023-24 allocation to Rs 6,323 crore, while the DST saw a 1% increase from Rs 7,931 crore in 2023-24 to Rs 8,029 crore.
The National Quantum Mission, a much talked about scheme of the DST that envisages developing critical technologies using the principles of quantum mechanics and with applications in cryptography and computing, has for the first time been provisioned Rs 2,819 crore reflecting a commitment to making headway this year. In her speech, Ms. Sitharaman mentioned, again without details, “A new scheme will be launched for strengthening deep-tech technologies for defence purposes and expediting ‘atmanirbharta',. Deeptech is a buzzword that lacks a precise definition but refers to start-ups working towards proprietary technologies in the field of artificial intelligence and other esoteric research areas and requiring large, sustained research investment".
This year, the Department of Biotechnology has experienced a reduction in allocations, declining from Rs 2,683 crore (2023-24) to Rs 2,251 crore, while the Ministry of Earth Sciences (MoES) saw a decrease from Rs 3,319 crore to Rs 2,521 crore. An explanation provided by a senior official attributes these cuts to the tendency of budgets for major programs to be spread over 3-5 years and the challenge faced by ministries in utilizing the allocated amounts within the prescribed financial years. The Finance Ministry, in its comprehensive evaluation of 'Research and Development' spending across various ministries, has allocated Rs 13,208 crore for 2024-25, up from Rs 12,850 crore in 2023-24. The actual spending during 2023-24, until December, amounted to Rs 12,943 crore.
