aiVBA and the Future of Public Funding: Why AI Must Power Grant Disbursal in India

In an era defined by rapid technological change, India stands at a crossroads. On one hand, we are home to the third-largest startup ecosystem in the world. On the other, our public funding mechanisms for young entrepreneurs remain outdated, slow, and exclusionary.

Despite hundreds of schemes and thousands of crores in budgetary allocations, India still lacks a transparent, scalable, and merit-driven system to evaluate and fund early-stage youth-led startups. The result? A massive opportunity cost.

Enter aiVBA India’s first indigenous, AI-powered startup evaluation engine, built as part of the Viksit Bharat Aatmanirbhar (VBA) campaign. Designed to democratize access to startup capital and eliminate human bias, aiVBA offers a bold, transformative solution to the structural flaws in our public grant systems.

This blog outlines why AI must become the core of India’s grant disbursal ecosystem, and how aiVBA is pioneering that future.

The Problem: Public Funding Without Precision

India has no dearth of government programs aimed at startup development Startup India Seed Fund, MSME credit lines, state innovation grants, Atal Innovation Mission, and more. Yet, most youth founders still struggle to access even the first ₹1–5 lakh they need to get started.

Why?

Because current funding models rely on:

• Manual evaluation based on outdated criteria

• Institutional filters (incubators, formal registration, networks)

• Bureaucratic red tape with little transparency

• Urban-centralized processes that exclude rural innovators

• One-size-fits-all assessments across diverse sectors

The result? Brilliant ideas from youth in small towns, tier-2/3 colleges, tribal areas, and vocational institutions are routinely overlooked not for lack of merit, but because there’s no system built to find them.

The biggest failure in public funding today is not in disbursing money but in discovering potential.

aiVBA: A New Era in Startup Evaluation

aiVBA (Artificial Intelligence for Viksit Bharat Aatmanirbhar) is a data-driven evaluation platform designed to assess startups across 15 core parameters. It combines human insight with machine learning to produce fair, consistent, and scalable evaluations of early-stage ideas.

Key Features:

• Multi-Parameter Scoring: Covers feasibility, innovation, team strength, scalability, sustainability, market size, and more.

• Sector-Agnostic: Works equally well for tech, agriculture, manufacturing, service, or social impact startups.

• Bias-Free Filtering: Removes human bias related to gender, geography, language, or academic background.

• Composite Scoring Model: Uses weighted averages to reflect holistic potential not just pitch quality.

• Scalability: Can evaluate thousands of startups across multiple states in real time.

With aiVBA, a student in Raichur has the same chance of getting funded as one in IIT-Delhi. That’s what real democracy in innovation looks like.

Why India Needs AI in Public Grant Systems : Now

The need for AI in startup evaluation is not just about speed. It’s about justice, inclusion, and efficiency.

To Eliminate Bias and Politics

Public grants often suffer from favoritism, network capture, and subjectivity. AI introduces transparent, evidence-based scoring, reducing favoritism and gatekeeping.

To Unlock Talent at Scale

India has over 90,000 colleges and 6,000 taluks each with untapped innovators. Only an AI-driven system can evaluate thousands of applications fairly and quickly without collapsing under administrative load.

To Make Grants Outcome-Oriented

Most grants are given based on forms and presentations. aiVBA uses data to predict startup success, flag red flags early, and reduce taxpayer risk.

To Decentralize Opportunity

AI allows for state-level, district-level, and taluk-level innovation pipelines not just central schemes. Each region can run its own version of aiVBA to identify local champions.

To Build Trust in the System

When young people know that their application will be judged on merit, not access, trust in public institutions rises. That’s the foundation of a self-reliant, participatory India.

Case Study: aiVBA in the VBA Campaign

As part of the Viksit Bharat Aatmanirbhar movement, aiVBA is being rolled out to evaluate 10,000+ youth startup ideas starting from Karnataka.

Here’s how the model works:

1. Youth Apply Online with basic idea details no DPIIT or Udyam registration required.

2. aiVBA Evaluates across 15 technical and business parameters.

3. Top 100 Startups Per State are shortlisted using weighted composite scores.

4. Public-Private Grant Disbursal is activated through PSR (Public Social Responsibility) + Ministry partnerships.

5. Mentorship & Acceleration follows for the best-performing youth startups.

   
   

The outcome? Data-backed, hyper-local innovation ecosystems built without bureaucracy or bias.

Policy Recommendation: Institutionalizing aiVBA

To scale this model nationally, we propose the following:

1. Create an “AI Grant Evaluation Protocol” for All Ministries

All public funding schemes under MSDE, MeitY, MYAS, MoRD, and MSME Ministry should adopt a shared AI scoring protocol for early-stage youth enterprises.

2. Make aiVBA a National Evaluation Backbone

Integrate aiVBA into Startup India, PM-VIKAS, Digital India Innovation Hubs, and state-level startup policies. Customize weightages as per sector and geography.

3. Enable Every College and Taluk to Nominate Startups

Allow local institutions to upload student projects and youth ideas into the aiVBA portal. Democratize nomination and evaluation.

4. Link AI Scores to Tiered Grant Amounts

For example:

• 70+ Score = ₹1 lakh micro grant

• 80+ Score = ₹3 lakh scale-up grant

• 90+ Score = ₹5 lakh + mentorship

This removes ambiguity and ensures clarity for applicants and funders alike.

Public Funds Deserve Public Intelligence

Today, private VC firms use AI to decide million-dollar investments. But public grant systems are still operating on paperwork and Excel files.

If we can use AI to guide military drones and stock markets, why not to fund the dreams of India’s poorest innovators?

aiVBA doesn’t replace human judgment. It enhances it with scale, fairness, and intelligence qualities every public rupee deserves.

From Potential to Policy: Building an AI-First Bharat

By institutionalizing aiVBA, India can:

• Save thousands of hours of manual review

• Reduce grant misuse by 30–40%

• Uncover millions of grassroots entrepreneurs

• Make every ₹1 in grant more impactful

• Position itself as a global pioneer in AI-led development governance

  
  

The Final Word

The question is not whether India can afford to adopt AI in its public funding ecosystem.

The real question is: Can we afford not to?

With aiVBA, we have a homegrown tool designed not just to evaluate ideas but to find hope in hidden places, back youth that no one sees, and rebuild trust in public systems.

If 2047 is to be a milestone of a Viksit Bharat, then 2025 must be the year we start trusting our youth and our data to get us there.

Because the future of public funding isn’t forms. It’s intelligence.

And with aiVBA, that future is here.