NEW DELHI – The first budget of India's newly elected government included some nice surprises for India's biotechnology sector in the form of international collaborations and a new bioclusters initiative.

In a budget he released earlier this month, Finance Minister Arun Jaitley set aside $250 million for the Department of Biotechnology (DBT), about $10 million more than was originally expected.

Last year, the DBT received $210 million out of $240 million budgeted, but expectations are high that this year the department will have access to all the funds pledged in the annual budget.

India's Bharatiya Janata Party led by Narendra Modi won an election in May – the landslide victory unseated the Congress Party led by Sonia Gandhi – and secured the country's first majority government in decades. Modi, the new prime minister, appointed Jaitley, a nationally known lawyer and close Modi advisor, as his finance minister.

The Modi victory suggested the country is looking for reforms that could kickstart the economy and speed up the work of a famously slow-moving government.

The budget, however, belied expectations in some quarters of drastic economic reforms.

DBT Secretary Krishnaswamy Vijayraghavan said he is happy with the number and with the emphasis on collaborations, which he sees as a priority.

Jaitley said India will work to develop global partnerships as part of an effort to transform the Delhi center of the International Centre for Genetic Engineering and Biotechnology "into a world leader in life sciences and biotechnology."

Molecular biology, bioinformatics and computational biology are just three of several areas in which the government will work to develop international collaboration projects. Others are human resource development, agriculture and food, medicine and health care.

Vijayaraghavan said the budget "will strengthen areas where our efforts will have more value for collaboration" and make it easier for institutions to work together in basic, applied and translational sciences. The DBT, he said, "was pushing hard to develop programs where we can partner internationally and nationally, to improve our quality."

A second initiative that buoyed the spirits of India's biotechnology sector is the $16.6 million set aside to develop biotechnology clusters. The development of biotech clusters in Faridabad, near Delhi, and Bengaluru will be "scaled up and taken to the highest international quality," Jaitley said.

The effort will include global partnerships in disease biology, stem cell biology and for high-end electron microscopy, and two new clusters will be developed in Pune, near Mumbai, and Kolkata.

Another push will see the Indian government providing central assistance to strengthen the states' drug regulatory and food regulatory systems by creating new drug testing laboratories and strengthening the 31 existing state laboratories.

India's Department of Science & Technology has some of the country's leading research centers in areas such as nanotechnology, materials science and biomedical device technology. The government will strengthen at least five such institutions as technical research centers to make them more effective in the innovation space through public-private partnerships.

Jaitley acknowledged in his budget speech that promotion of entrepreneurship and start-up companies remains a challenge in India and announced a $160 million fund to attract private capital by provding equity, quasi-equity, soft loans and other risk capital for start-up companies.

The announcement comes as a shot in the arm for India's biotech sector and is something the industry needs, according to the Biotechnology Industry Research Assistance Council (BIRAC), a public sector not-for-profit company set up by DBT to give a boost to emerging Indian biotech enterprises to undertake strategic research and innovation to address nationally relevant development needs.

BIRAC attempts to fund initial stages of proof-of-concept and lab-scale demonstration for innovative ideas of promising entrepreneurs, some of which are attempting to offer novel biotech solutions in health care. Examples of bioinnovation efforts supported by BIRAC include point-of-care diagnostic devices and co-crystal-based cancer drugs.

One such diagnostic product, developed by Delhi-based Designinnova, uses fluorescence technology and has the potential to offer multiple diagnostic options for hepatitis C and hepatitis B, syphilis and other infectious diseases. It offers scope for testing for multiple infections simultaneously in remote areas.

In another BIRAC-supported effort, Crystallin Research developed co-crystal of temozolomide, a cancer drug. The co-crystal has important national and societal relevance as it is stable at higher temperatures, which makes it particularly useful for tropical countries.