Ather Seeks Support from INR 1 Lakh Crore Innovation Fund to Counter Rivals’ Incentive Edge
Ather Energy is in the process of finalising its participation in the government's INR 1 trillion research, development, and innovation (RDI) programme. With this change, the electric vehicle manufacturer will be able to secure long-term debt capital at a reduced rate for its initiatives.
As a result, filling an essential void while its incorporation into the production-linked incentive (PLI) automobile programme continues to be stalled. Working capital for research and development could be available once the company finalises the term sheet for the borrowing arrangement. Applicants can take advantage of loan rates as low as 2-3% on approved projects through this funding programme, with payments tied to project milestones.
Ather Following the Footsteps of its Competitors
This development comes at a time when competition in the electric two-wheeler sector is heating up, as competitors like Ola Electric, Bajaj Auto, and TVS Motor are still reaping the benefits of the INR 25,938-crore PLI vehicle program. Companies like Ather Energy were unable to participate in the program because of the stringent entrance requirements. These include a minimum revenue of INR 10,000 crore for automotive companies and a net worth of INR 1,000 crore for non-auto firms.
Funds were scheduled to be disbursed in the coming months once the corporation signed the final term sheet. With the launch of its new EL platform and the creation of a distinct platform for future electric motorcycles, the Bengaluru-based business is well-positioned to take advantage of the RDI plan. The media has reported that this scheme's investment is going toward commercializable innovations. Working on ideas alone is not enough. This investment helps Ather get lower operating capital for some important projects in the electric vehicle industry. To promote R&D in the business sector, Union Finance Minister Nirmala Sitharaman unveiled the INR 1 trillion RDI initiative in her February 2025 budget speech.
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Some Interesting Facts for the Story |
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1.Industry experts view long-term, low-cost
funding as a critical advantage for EV startups investing heavily in
technology development. 2.The RDI scheme focuses on
commercializable innovation, not just research concepts. 3.Approved projects can access financing at
rates significantly lower than commercial borrowing costs. |
Why Funding for Research is Important for a Firm?
Financing research projects in the electric vehicle field with long-term finance might significantly benefit any company that received the funds, according to experts. Since Ather's attempts to persuade the government to include it in the PLI Auto project have so far failed, any investment in technological development would be a huge boon to the company.
Incentives under the PLI auto system, which may award as much as 82 enterprises depending on their eligibility, range from 13 to 18% of the sales value. As Ather's co-founder and CEO Tarun Mehta has stressed time and time again over the last year, PLI auto funding is a huge boon for startups trying to grow their innovation engine.
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Quick Shots |
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•Ather Energy is finalising participation
in the Government’s INR 1 lakh crore Research, Development and Innovation
(RDI) Fund. •The funding will provide long-term debt
capital at concessional interest rates of 2–3%. •The move is expected to support Ather’s
R&D and product development initiatives. •Ather is pursuing the RDI route while its
inclusion in the PLI Auto Scheme remains unresolved. |
