Govt to soon have a deeptech startup policy

The Indian government is establishing a dedicated policy to foster the growth of deep technology startups, according to Rajesh Kumar Singh, Secretary of the Ministry of Commerce and Industry. 

Deep tech, or deep technology, refers to those startups whose business model is based on high tech innovation in engineering, or significant scientific advances. While many of these are still in development, these entities hold potential for significant disruptions

This move comes in response to the growing interest in the deep tech startup ecosystem, fueled by recent initiatives such as a Rs. 1 lakh crore fund for startup support and a fresh approach toward deep tech innovation in defense. 

Speaking at the 'Startup Mahakumbh' event in the national capital on Monday, Singh said that the deeptech startup policy is in the final stages of inter-ministerial discussions. "We hope to bring it forward soon. We will hopefully move towards creating a dedicated fund of funds," he told the gathering, adding that the country will soon see a separate window for deeptech startups. 

More than 34 deeptech startups are showcasing their innovations at the Nasscom pavilion at the event, facilitating insightful discussions across sectors including Artificial Intelligence, software-as-a-service (SaaS), direct-to-consumer brands, agritech, fintech, deeptech, biotech and pharma, incubators, climate tech, E-sports, and B2B manufacturing. 

India remains the third-largest tech startup ecosystem globally, with over 950 tech startups founded last year. According to a latest report by Nasscom, in collaboration with Zinnov, investments in deeptech will continue to see an upward trend in 2024. With Generative AI (GenAI) acceleration, 70% of startup founders are embedding AI in their solutions. 

Notably, a decade ago, India had fewer than 100 deeptech startups, but between 2014 and 2023, this number surged more than four times to over 400. According to the report, the ecosystem has become more structured and now encompasses new sub-sectors such as defence tech, dronetech, spacetech, IoT & hardware, and robotic process automation, among others. 

These startups leverage advanced technologies like artificial intelligence (AI), augmented reality (AR), virtual reality (VR), cloud computing, machine learning (ML), big data analytics, robotic process automation, Gen AI, and more to address complex global problems with innovative solutions, attracting investors to the sector. 

In her interim budget speech, Finance Minister Nirmala Sitharaman also said that a new scheme would be launched to strengthen the deeptech sector for defense purposes. 

Singh further stressed that over 50% of such startups are from tier two and tier three cities, and almost 45% have at least one woman as a director on the board.