Budget 2024: New scheme for deep tech for defence sector, corpus for R&D

A new scheme to encourage development of deep tech for the defence sector and the announcement of a ₹1 lakh crore corpus for long-term interest-free financing have come as a major boost for the domestic ecosystem and are likely to spur research into disruptive technologies.

The scheme is likely to give startups and established players access to testing and validation facilities of the ministry, guidance by the armed forces and access to long-term interest-free loans needed to develop weapon systems.

Research and development of future weapon systems has largely remained under government-owned entities like DRDO as it requires long-term capital infusion and there is no guarantee for success, making it tough for private companies to commit funds.


"The announcement of a ₹1 lakh crore corpus for deep tech for long-term loan to tech-savvy youth and companies and tax advantage to startups will give further impetus to innovation," a defence ministry official said.

The scheme is likely to spur joint research into disruptive technologies with foreign partners who are keen to invest in India and co-develop future weapon systems. Top executives in India-based defence companies have welcomed the announcement. "This scheme will be pivotal for growth and resilience of our nation's defence sector in areas such as AI, quantum, analytics and more," said Ashish Saraf, country director for India at Thales.