India Inc Urged to Utilize Rs 20,000 cr R&D Fund

New Delhi, Feb 3 (PTI) Economic Affairs Secretary Ajay Seth on Monday urged India Inc to focus on Research and Development (R&D) and utilise Rs 20,000 crore fund announced in the Budget through good quality proposals.

The Finance Minister has allocated Rs 20,000 crore for private sector-led research and development, he said while speaking at post-Budget interaction with members of CII here.

"Can we work towards a scenario where before the end of the year there are good quality proposals to use up the entire money," he wondered.

Seth also called for involvement of the private sector in energy transition and working with industry on nuclear energy.

While announcing Budget 2025-26, Union Finance Minister Nirmala Sitharaman on Saturday allocated Rs 20,000 crore to the Department of Science and Technology as a corpus for a fund to promote private sector-driven innovation.

She had announced setting up of a Rs 1 lakh crore R&D fund in the Budget last July.

"To implement the private sector-driven Research, Development and Innovation initiative announced in the July budget, I am now allocating Rs 20,000 crore," she had said.

Meanwhile, Chief Economic Adviser V Anantha Nageswaran said various measures announced by Finance Minister Nirmala Sitharaman in Budget 2025-26 targetted to support the economic growth by encouraging domestic manufacturing and demand amidst geopolitical uncertainties.

"It is quite clear that the current state of the world, in terms of geopolitical and geoeconomic uncertainties, is very much the guiding tool behind many of the proposals you see in the Budget, including the widely discussed tax cut," he said.

The income tax cut, which is likely to boost consumer demand in the economy, can nudge the private sector to expand capacity, he said.

Thus, the private capital expenditure, which has been happening at a slower than expected pace so far, will pick up going ahead, he added.

As part of fiscal measures to boost growth, the Budget proposed significant income tax cuts for the middle class. Individuals earning up to Rs 12.75 lakh a year will not have to pay any taxes, benefitting 1 crore taxpayers.

The Union Budget 2025-26 proposes new direct tax slabs and rates under the new income tax regime so that no tax is needed to be paid for total income up to Rs 12 lakh per annum. Salaried individuals earning up to Rs 12.75 lakh per annum will pay nil tax, due to standard deduction of Rs 75,000.