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An experience of over two decades of the scheme brought it to the forefront that a large number of scholarships were restricted to certain pockets of the country and many areas remained unrepresentative. In the light of this, the scheme was recast in 1985.

The scheme, which until now was completely centralised, was partially decentralised and was confined to only Class X Under the new arrangement the selection of candidates for the awards became a two-tier process. The states and the union territories were entrusted with the responsibility of conducting the first tier screening examination known as State Level Talent Search Examination. Each state and union territory was to select and recommend a stipulated number (state quota) of candidates for the national level examination to be conducted for about 3000 candidates by the NCERT. The number of scholarships, however still continued to be 750 including 70 for SC/ST candidates.

The state and the union territory quota were to be computed proportionately on the basis of the student enrolment at secondary level with a minimum of 10 for a union territory and 25 for a state and a maximum of 500 for either of the two. This quota was to be reviewed every three years.

The states had complete autonomy to design and conduct their written examinations. However, they were advised to follow the national pattern which comprised MAT and SAT. The MAT, which consisted of 100 multiple choice type questions, was to be attempted by all the candidates. The SAT consisted of 25 multiple choice type questions each on eight subject areas namely Mathematics, Physics, Chemistry, Biology, History, Geography, Civics and Economics. The candidates could choose any four out of these eight subjects and had to answer a total of 100 questions in the SAT. A stipulated number of candidates who qualified at the nationalleve1 examination were called for face-to-face interview. The award of scholarships was finally determined on the basis of the candidates' scores obtained in all the three components namely the MAT, the SAT and the Interview.

A crucial modification in the scheme was again made in the year 1995 when the provision of choice in the SAT was abolished and all the subjects were made compulsory. These subjects were Science, Social Science and Mathematics with 40, 40 and 20 questions respectively.

In the year 2000 the number of scholarships was raised from 750 to 1000.

A major change in the scheme came in 2006, The following modifications have been made in the scheme.

The scholarships under the present scheme are awarded to the candidates for pursuing courses in sciences and social sciences up to doctoral level and in professional courses like medicine and engineering up to second-degree level subject to the fulfillment of the conditions provided in this brochure.