Building India's deeptech infra not a choice but a critical necessity: Zinnov's Vikalp Sharma

Illustration: Chaitanya Surpur

India is at an inflection point in its technological evolution as evidenced by the growth of the sector. The country is poised to drive artificial intelligence (AI) investments worth $6 billion-plus by 2025. India’s moment to ride the next phase in the S-curve of technological advancement and leapfrog into emerging domains is now.

This includes not only AI, but also augmented reality / virtual reality (AR/VR), big data and analytics, blockchain, Internet of Things (IoT), drones, and robotics. These ‘deep technologies’ will drive the next wave of innovation across industries and fuel the next phase of economic growth. For India to become a global innovation leader, we need to build capabilities strategically yet rapidly across the deeptech value chain—from research to commercialisation—in these cutting-edge technologies. 

India’s Imperative for Deeptech Leadership

Deeptech adoption is rising; Zinnov’s analysis reveals that deeptech startups comprised 12 percent of all of India’s tech startups in 2022. In fact, the segment has witnessed a CAGR of 44 percent over the last decade and attracted $4.2 billion in funding in 2022. Deeptech’s adoption is critical not just for India’s economic advancement, but also to solve major socio-economic challenges stemming from its large and growing population of 1.4 billion.

Challenges in food security, agriculture, nutrition, and health care have plagued India for decades, and now require biologically inspired solutions and precision delivery mechanisms that deeptech can enable. In fact, India’s biodiversity and genomic variance within population groups provide unique opportunities for biotech innovation. Sectors like health care, agriculture, education, and financial services require advanced technological interventions to improve access, efficiency, and delivery at scale.

Enterprises and startups in India are leveraging deeptech whether it be for building application-level AI models or tapping AI talent for other functional/vertical-specific needs. India boasts a reservoir of technologically adept minds (especially when it comes to AI), a rapid uptake of digital services, and a thriving entrepreneurial spirit—an enviable foundation for progress. However, the crux of the matter lies in understanding the consequences of inaction when it comes to infrastructure and capacity building.

Without an intentional and strategic push, the country risks stifling the potential of its innovation ecosystem, its capability to lead in cutting-edge fields, drive social prosperity and economic growth, and compete globally. The need for a resolute commitment to building our deeptech infrastructure is not merely a matter of choice but a matter of securing India’s trajectory as a dynamic, innovation-driven powerhouse on the global stage.

Strategic Focus Areas Aligning to India’s Needs

Over the last three decades, India has established itself as a global software services powerhouse. This has been the cornerstone of the massive scale to which the Indian technology ecosystem has grown and evolved—across technology startups, Global Capability Centers (GCCs), Indian enterprises, and services companies.

Deeptech solutions are compute-intensive and need advanced semiconductor and high-performance computing infrastructure, IoT devices and related capacities. Deeptech investments mandate patient capital and the investor community provides not just the necessary financial capital but also a wealth of expertise, mentorship, and access to valuable networks. India also requires more specialised research institutions and university programmes to nurture top talent in deeptech domains.

Stronger academia-industry collaborations are vital to take promising research from lab to market. The investor community emerges as a lynchpin of progress, especially for deeptech startups. Further, government policy and regulatory support will be crucial to rapidly advancing this prowess. Initiatives such as NIDHI Prayas programme, and the National Deep Tech Startup Policy draft are steps in the right direction. They enable investors to consider deeptech startups as key investment areas by providing collaboration and incentives like tax breaks. However, areas like data regulation, IP protection, and procurement policies still need to be geared towards spurring innovation and adoption.

Also read: Celesta Capital: At a sweet spot in India's deep tech startup landscape

Schemes to support seed-stage startups and mechanisms to transition from proof-of-concept (POC) to commercialisation will be key. Global experiences are testament to the fact that government support, not just involvement, is essential in the early stages of development of advanced technologies and their integration into industry and society. 

Role of Industry

GCCs in India can enable deeptech capabilities with government partnership. The 1,580+-strong GCCs that house 1.66 million talent, are positioned to collaborate with and support deeptech startups. These GCCs have driven digital transformation for global customers, by enabling value, talent, and innovation arbitrage. Since deeptech needs newer approaches and business models, emerging areas like bioengineering space and satellite tech, quantum computing, clean energy, etc, call for a culture of design thinking, solution incubation, and IP creation. These form the key pillars of the Indian GCC ecosystem.

Also read: How to fuel the growth of the deep tech sector in India

GCCs are playing a key role in boosting the startup ecosystem through accelerator/incubator programmes. And it isn’t a stretch of the imagination for them to go one step further, by bringing in their expertise, knowledge, and ecosystem connects through programmes for deeptech startups like Target Accelerator Programme India, and Cisco LaunchPad. Startups, in turn, can provide GCCs with an understanding of technologies.

Realising India’s Potential

While we are a software talent-rich nation, we cannot rest on our laurels. India cannot afford to miss the deeptech opportunity. A cohesive blueprint needs to be drawn, that can enable the smallest startup to the largest enterprise to innovate on and build deeptech solutions.

Israel is a case in point, which has become a global deeptech powerhouse. Through government policies and tech talent, Israel has built world-leading capabilities in areas including cybersecurity, semiconductors, AI, and medical devices. India can similarly leverage its talent pool and market size for exponential deeptech growth.

Also read: Indian deep science tech ecosystem: An untapped opportunity for investors

With support from industry-focussed innovation clusters, improved market access, academia collaborations, enhanced technology business incubators/accelerator ecosystem, and increased access to seed capital, and thematic funds, India can nurture a thriving deeptech industry by 2030. Key metrics around patents filed, research output, startups created, and revenue generated will be the signals of progress as the nation treads this journey.

India must embrace its tryst with deeptech across the innovation spectrum, from labs to markets. Building technological self-reliance will enable delivery of inclusive development at scale. But this requires a holistic approach. Government, industry, academia, and civil society must jointly step up efforts in deeptech research, infrastructure, market access, skills development, and entrepreneurship promotion. The possibilities are endless if India can fully leverage its strengths and harness the power of deeptech.