A gift horse’s teeth: on allocations and scientific research.  

Higher allocations are not enough to boost scientific research.

The Budget 2025-26 announcements suggest a potential bonanza for scientific research and development. The Finance Minister outlined ₹20,000 crore budgetary support for developing small modular reactors, with the goal of readying five such reactors by 2033. Another major initiative is the Research, Development, and Innovation fund, included in the Department of Science and Technology (DST)’s expected expenditure. This substantial allocation is expected to benefit start-ups and sunrise sectors, though these remain undefined. The expectation is that private sector entities will receive financial support to boost R&D, a domain historically dominated by government spending. India’s R&D landscape has long suffered from low private sector participation. While government funding has driven most scientific advancements, private investment in research has remained inadequate. Currently, private sector R&D contribution is only 36%; overall R&D spending in India was 0.64% of GDP in 2020, the lowest since 1995. Over the last five years, business enterprises have accounted for around 40% of government R&D expenditure. Public sector R&D units allocated only 0.30% of their sales turnover to research, compared to 1.46% by the private sector in 2020-21, according to DST estimates.

The government’s ₹20,000 crore infusion hikes the DST’s total budgetary allocation to around ₹28,000 crore, over three times last year’s allocation and seven times the actual expenditure in 2023-24. These figures are encouraging, but a key concern is whether such massive investments can be effectively absorbed. Despite India’s strengths in technology-driven sectors such as fuel, metallurgy, pharmaceuticals, textiles, IT, and biotechnology, returns from core R&D and intellectual property generation are still meagre. Though the government has launched ambitious missions in quantum computing, artificial intelligence, and other cutting-edge technologies, the supporting infrastructure remains inadequate. India still lacks the essential building blocks, chipsets, semiconductor fabs, a skilled engineering workforce, and a strong innovation ecosystem, to fully capitalise on these investments. Without these, the lofty targets set for R&D growth risk falling short. The government must present a clear road map on how private sector entities can access these funds and what tangible benefits the public can expect. Increased funding alone will not guarantee success unless structural bottlenecks are addressed. To truly transform India into a research powerhouse, the focus must shift to strengthening foundational infrastructure, incentivising private innovation, and ensuring long-term, sustainable engagement from industry leaders.