Govt Deep-Tech Fund: Rs 2,192 Cr Cleared, 62% Goes To Firms Linked To Panel That Chose Them, Pg1

Key Highlights:

• The Research, Development and Innovation (RDI) Fund approved Rs 2,192 crore in soft loans to 22 deep-tech companies in its initial round.
• An investigation revealed that Rs 1,377 crore (62%) of the approved funds were allocated to 15 companies with investment ties to seven members of the 12-member selection panel.
• The selection panel is the Investment Committee of the Technology Development Board (TDB), operating under the Department of Science and Technology.
• Saurabh Srivastava, chairman of the selection panel, was linked to nine of the funded companies, including a personal stake in one.
• Committee members stated they disclosed their financial interests and recused themselves from decisions involving linked firms.
• The issue was raised in Parliament by Rajya Sabha MP Praveen Chakravarty, questioning the propriety and institutional robustness of the process.

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Detailed Insights:

• The RDI Fund, launched in November 2023, is a Rs 1-lakh-crore initiative designed to boost India's deep-tech sector.
• The Department of Science and Technology is responsible for identifying and selecting firms to receive funding from this initiative.
• The controversy highlights concerns about potential conflicts of interest when individuals with private investment interests are part of public fund allocation committees.
• While committee members claimed adherence to guidelines of disclosure and recusal, critics argue that such measures, common in the corporate world, may not be sufficient for public funds.
• The Ministry of Science and Technology clarified that selections were made "purely on merit" with no involvement from conflicted members during evaluation.
• Suggestions include forming selection committees primarily with scientists and academics who lack for-profit indulgences, using external experts for commercial viability assessments.
• The incident underscores the critical need for not only fair processes but also the perception of fairness and robust institutional guardrails when dealing with public money.

Key Concepts Involved:

• Deep-tech: Technologies based on significant scientific discoveries or engineering innovations, often requiring extensive research and development.
• Conflict of Interest: A situation where a person's private interests could improperly influence their official duties or decisions.
• Recusal: The act of withdrawing from participation in an official action or decision due to a conflict of interest.
• Public Fund: Financial resources collected from the public, typically through taxes, and managed by the government for public welfare and development.