RDIF does not require AIF SLFMs to have a minimum size for the Schemes for which they are applying to RDIF for funds, with or without greenshoe. However, all prospective SLFMs will be screened for quality and cost parameters, as outlined in the Notice Inviting Applications. It is clarified that a Greenshoe option, if exercised by an AIF, would not lead to an increase in the RDIF contribution that was earlier determined.

It is clarified that SLFMs are free to raise money from non-domestic limited partners, as long as such investments comply with Indian law and regulation.

AIF SLFMs can raise funds from international investors, provided that all investments comply with Indian laws and regulations.

RDIF funds may be used to advance, from Technology Readiness Level 4 onward, RDI-intensive technologies: defined in the Guidelines as, among other Page 2 of 35 things, typically having high uncertainty (and consequent failure risks) in functionality, adoption, production, standards / architecture. These risks define such technologies at different stages of development and commercialisation, including the growth stage.

SLFMs may therefore apply to RDIF for funding to focus on growth-stage investments in companies and startups, as long as these comply with the RDIF Implementation Guidelines [Paragraphs 5, 6, 7, 8, and 9].

RDIF does not specify any preference or priority with respect to fund stage—for example, Series A versus Series B, or early-stage versus growth-stage funds. Any entity within the eligible Fund Manager categories specified in Part A, Paragraph 4 of the Implementation Guidelines, and with an investment thesis aligned with RDIF Investment Guidelines, is eligible to apply for RDIF funding across any stage.

RDIF does not specify preferences between sub-sectors within priority domains. When investing in SLFMs, all RDIF Priority Sectors are treated equally. However, RDIF funding must be used by SLFMs exclusively for technologies and sectors listed in the RDIF Implementation Guidelines (see Part A, Paragraph 5).

It is clarified that it is not mandatory to collaborate with a government or academic institution to be eligible for RDIF capital. RDIF has been designed to encourage private sector to scale-up Research, Development, and Innovation (RDI). It may be noted that RDIF shall not finance RDI by government entities and central public sector enterprises (CPSEs), unless they are involved in strategic projects in partnership with the private sector.

Incubators in general will not be supported by RDIF. However, if any Incubator setups an AIF, then such AIFs are assessed as per Evaluation Matrix 5.1 in the Notice Inviting Applications.

RDIF does not apply minimum or maximum restrictions on any of the following aspects:

1. The size of the AIFs which are eligible for an RDIF contribution. RDIF will contribute to small or large AIFs alike, as long as they are competitive across the quality and cost criteria outlined by the Quality and Cost-Based Selection Evaluation Matrices in the Notice Inviting Applications;
2. The age or maturity of an AIF, in order to be eligible for RDIF contribution. RDIF would be willing to finance both well-established and newly-established Page 4 of 35 AIFs. The Notice Inviting Applications explicitly states, in Evaluation Matrix 5.1: “If only one or no prior Fund has been launched previous to this one, as Schemes of the current Trust / with the current management team: details may be provided for previous funds with which individual Partners were earlier associated.”

RDIF therefore ensures that both new and small Funds have the opportunity to receive support.

1. AIFs seeking funding from RDIF must conform with SEBI Regulations. For Investment Committees, this includes SEBI (Alternative Investment Fund) Regulations 2012 Chapter IV, the Fourth Schedule, and other relevant clauses. Special attention is drawn to Regulation 20(7): “The Manager may constitute an Investment Committee (by whatever name called), to approve the decisions of the Alternative Investment Fund and such constitution shall be subject to such conditions as specified by the Board from time to time.”
2. Additionally, it may be noted that Guidelines Appendix C.1. specifies:
   1. Paragraph 1: “Any SLFMs that have RDIF funds shall have Investment Committees (IC) that may contain a mix of technical and financial experts from the private sector, academia, technology, and financial sector as per the basis/ nature of sector and industry. The Investment Committee must be constituted in a way that avoids potential conflicts of interest.”
   2. Paragraph 5: “Each SLFM’s IC shall vet the selection of specific projects to be funded.”
3. The establishment of an Investment Committee is therefore necessary for SLFMs to use RDIF funds.

4. RDIF will not be over-prescriptive regarding the composition of Investment Committees, beyond the Guidelines in Appendix C.1.

   However, it may be noted that RDIF Management Team, Executive Council ANRF, and the Empowered Group of Secretaries (EGoS) will assess the Fund Management Team’s Competence as Criterion 1 in Evaluation Matrix 5.1 of the NIA. Criterion 1 includes the quality of the Investment Committee.

Only SLFMs that are (a) statutory organisations (b) public institutions (c) academic/research/non-profit organisations wholly funded by the Government of India or State Governments would be appointed on the basis of nomination by the EGoS, on the recommendation of the ANRF Executive Council. AIFs sponsored by public sector banks would be evaluated based on Quality and Cost Criteria as specified in NIA.

RDIF encourages both existing, well-established Funds, as well as newer Funds, which focus as much as possible on RDIF Priority Sectors, to apply for funding. RDIF would assess new Funds based on the track record and details of previous funds with which individual Partners were earlier associated.

Entities which have submitted their applications for AIF registration to SEBI but have not yet received it, are eligible to apply for RDIF for funding. Such entities would be required to submit proof of application to SEBI. Such entities, if selected, would be eligible to receive a conditional Letter of Intent (LOI) of funding from RDIF. However, RDIF would not enter a Contribution Agreement with such an entity until SEBI registration is successfully completed, and full documentary support for this is provided to RDIF.

RDIF encourages both existing, well-established Funds, as well as newer Funds, which focus as much as possible on RDI-intensive technologies and RDIF Priority Sectors, to apply for funding.

Emerging Fund Managers who are establishing Funds focused specifically on the technologies and sectors described in Part A Investment Policy for the RDIF Implementation Guidelines are particularly encouraged to apply to RDIF.

As specified in Evaluation Matrix 5.1: If only one or no prior Fund has been launched previous to this one, as Schemes of the current Trust / with the current management team: details may be provided for previous funds with which individual Partners were earlier associated (emphasis added).

In such cases, Criteria such as Fund Management Team Competence will be evaluated for the individuals forming the new Fund.

Incubators and accelerators in general are NOT eligible to apply for RDIF funding. DST has many schemes supporting Incubators and Accelerators. RDIF will not provide support for incubation activities. In certain exceptional cases, where an incubator (a) meets the definition of a Fund Receiving Organisation (FRO) as set out in the RDIF Implementation Guidelines; and (b) satisfies the eligibility and selection criteria specified in NIA Section 5, Paragraph 6, and the Evaluation Matrix (Section 5.2), their applications may be considered.

Regarding modalities: as the NIA language specifies, RDIF will consider and accept modalities of funding including grant, debt, or equity.

Regarding minimum threshold: FROs must have funded over 5 companies and startups in the previous three years.

1. AIFs in the midst of fundraising are eligible to apply for RDIF funds, even if private capital commitments have not been finalised at the time of application.
2. RDIF contributions to AIF SLFMs will be determined as a percentage of aggregate contribution. This will exclusively reflect the AIF SLFM’s focus on RDI-intensive technologies and RDIF Priority Sectors.
3. SLFMs which qualify for selection under RDIF’s Quality and Cost Based Selection (QCBS) process will be provided with a Letter of Intent, specifying an RDIF contribution as per (a) and (b) above.
   1. RDIF will issue this Letter and specifying this contribution irrespective of the status of private commitments to the AIF at the time of selection.
   2. The Letter of Intent will specify terms that will enter the final Contribution Agreement that RDIF will enter with the SLFM.

However, RDIF will enter a Contribution Agreement committing capital to the selected SLFM only once it has received and verified Contribution Agreements from private contributors to the SLFM.

Fund managers which focus on a wide range of technologies and sectors may also apply for RDIF funding, as long as these include RDI-intensive technologies and RDIF Priority Sectors respectively.

However, SLFMs which focus exclusively RDIF’s priority sectors would receive a higher RDIF contribution as a percentage of aggregate contribution, than those which do not. Kindly refer to the Clarifications to the Implementation Guidelines (S No 7).

For multiple Funds managed by the same manager, a single application can be submitted per Fund.

RDIF will not be overly prescriptive in such matters. RDIF funds may be used to finance transformative projects beyond Technology Readiness Level 4, involving RDI-intensive technologies for RDIF Priority Sectors. The specific details of how such capital would be used for such activity is left to the SLFM and its investee company / startup.

SLFMs must provide documentation, the content and periodicity of which is specified in Paragraph 8.1 of Part B of the RDIF Implementation Guidelines.

RDIF will not be overly prescriptive in requiring quantified specifications of a project’s compliance with TRL 4 by an Eligible Technology Entity. The TRL 4 specification is a general one, indicating that RDIF funds must be used in commercialisation-focused projects that have at least achieved laboratory-level prototypes, and that they cannot be used in basic or applied R&D.

Though, SLFMs can refer to the National Technology Readiness Level (TRL) Assessment Framework released by the Office of the Principal Scientific Adviser to the Government of India (https://www.psa.gov.in/national-technology-readiness). This framework provides guidance on evaluating RDI intensity and TRL levels.

RDIF capital may only be used by SLFMs to exclusively fund RDI-intensive technologies in RDIF Priority Sectors.

AIFs must use RDIF funds that they receive exclusively on projects entailing RDIintensive technologies, in RDIF Priority Sectors, at Technology Readiness Level 4 and above. Such projects/ funding rounds cannot use RDIF funds to an extent greater than 50% of the project cost, as specified in Para 7.2 in Part A of the RDIF Implementation Guidelines; the balance financing should be arranged by the project proponent from self or commercial sources.

Beyond this, RDIF does not specify a threshold for the use by SLFMs of their own capital. May also please refer to the answer to Question No 61 of this document.

However, it may be noted that AIF SLFMs will be eligible to receive a higher contribution from RDIF as a share of their aggregate capital, depending on the extent to which they focus on RDI-intensive technologies and RDIF Priority Sectors. This would be specified in their Private Placement Memoranda / Investment Theses, and verified by reporting to RDIF on their investment activity as specified in Paragraph 8.1 of Part B of the RDIF Implementation Guidelines.