- विज्ञापन -
New Delhi: Commerce Minister Piyush Goyal recently raised a crucial point about India’s startup ecosystem. While Indian startups are thriving, especially in consumer-focused sectors like food delivery, quick-commerce, and even “healthy” ice creams, Goyal suggests that they are not pushing the boundaries of innovation. These businesses, according to him, are not the kind of startups that will drive the economy forward in the long term. Instead, they resemble traditional businesses that, while successful, don’t have the transformative potential of companies like Apple, Tesla, Google, or Meta. So, why is India struggling to build these kinds of global tech giants?
With that, let’s get into the specifics — with all the bad loops India is stuck in, that is stunting our innovative potential. These problems aren’t specific to our inability to make AI models or EVs; they’re deeper problems with our economy. Our poor innovative capacity is just one more symptom of these problems.
Focus on Consumer Apps, not deep tech
Many of India’s successful startups focus on consumer services like food delivery (Swiggy, Zomato), e-commerce (Flipkart), and fintech (Paytm). While these businesses are important, they don’t drive the kind of deep, transformative innovation seen with global giants like Apple or Alphabet, which focus on developing new technologies and creating entirely new industries. Indian startups rarely focus on deep-tech like electric vehicles, AI, or semiconductors.
Investor Mindset: Quick Returns
Indian Investors prefer startups that can scale quickly and provide fast returns, like delivery apps or fintech. Building companies like Apple or Tesla takes time and long-term investment, which Indian investors are less willing to make.
Lack of Infrastructure
Countries like China have strong infrastructure to support tech giants, while India still faces gaps in manufacturing and supply chains. India lacks the infrastructure needed to develop and scale deep tech innovations, such as electric vehicles or advanced semiconductors. The tech industry in India gained momentum much much later compared to Silicon Valley. The internet revolution and the rise of personal computers happened earlier in the US, giving American tech companies a head start.
Education & Talent Gaps
India’s Education system focuses more on service industries rather than fostering innovation in deep-tech. There is no focus on creative problem solving, only rote learning and memorization. And because we are a society without much, everyone wants to be an engineer. As a result we have lots of people who passed engineering exams and not enough engineers. India lacks the skilled workforce needed for tech innovation, and many top talents move abroad for better opportunities.
Market size & willingness to pay
The domestic market in India is still relatively small compared to the US and other developed markets, making it harder for Indian startups to achieve the scale required to become tech giants. Also we have hard time accepting the recurring paying structure for a tech products. People want either free product or lifetime deal.
Limited Government Support
While India supports startups, most initiatives focus on small businesses rather than high-tech sctors. India needs more government policies that focus on nurturing deep-tech startups, especially in areas like EVs, AI, and semiconductors.
Cultural Shift towards Innovation
Indian Culture tends to focus on service-based businesses, not on developing complex technologies. The risk-taking culture and the acceptance of failure as a part of the entrepreneurial journey are not as deeply ingrained in India as in Silicon Valley. To build global tech giants, India needs to shift towards fostering a mindset that values long-term innovation over quick wins.
Ecosystem Challenges
India’s startup ecosystem lacks the strong mentorship, networking, and global market access present in more established innovation hubs like Silicon Valley, where collaboration between businesses, universities, and government thrives.
Instead of wondering why we don’t innovate enough, let’s flip the question: why do countries innovate?
Innovation is driven by a variety of factors, and countries that succeed in fostering it tend to have key elements in place. These include strong leadership at both government and corporate levels, which encourages investment in new technologies. Additionally, countries that invest in education, particularly in technical fields, provide the talent necessary for innovation.
India needs more risk capital for Indians to build great companies here from India and not from the US. That’s where India will see more global technology companies (instead of more payment cashback apps) – that will be India’s $100 billion revenue company dream. Some factors which are responsible are late entry into the tech race, lack of sufficient risk capital, a cultural aversion to risk, and gaps in specialized talent. India’s Startup system is still maturing, with limited collaboration between businesses, universities, and government.
There’s no single ingredient that can suddenly make us an R&D powerhouse. Simplistic answers won’t get us very far — because there are many other things that will naturally stop our progress.
♦If we open more IITs, for instance, but don’t have an industrial base to absorb their graduates, we’ll simply create more workers for foreign companies.
♦If we set up government schemes to subsidise deep tech companies, but those same companies then struggle with archaic land and labour laws, we’ll end up wasting a lot of money for nothing.
And so on.
A smarter way of going about this question is to try and understand the various relationships between everything that goes into making an innovative economy.
Conclusion:
Overcoming these barriers will require a fundamental shift in how the country approaches risk, talent development, capital investment, and regulatory reforms. By creating a more supportive environment for deep-tech innovation, nurturing risk taking, and fostering greater collaboration, India can unlock its potential to becoma a global leader in technological innovation.
India’s path to becoming an innovation hub will take time, but with the right policies, cultural shifts, and investments, the country can position itself to compete with global giants in the years to come.
