Union Budget 2025: India's Journey to Global Leadership in Innovation with a Spotlight on Deep Tech

Innovations and Initiatives Infrastructure and Communication

Posted by NewAdmin on 2025-01-28 12:27:59 |

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Union Budget: Driving the Growth of India’s Deep Tech Ecosystem

India’s Deep Tech ecosystem stands at the cusp of exponential growth, driven by the convergence of cutting-edge science and entrepreneurial ambition to solve complex global challenges. Encompassing fields such as Artificial Intelligence (AI), Machine Learning (ML), Internet of Things (IoT), Blockchain, Big Data & Analytics, Augmented Reality/Virtual Reality (AR/VR), Robotics, 3D printing, and Drones, Deep Tech is reshaping innovation.

With its unique blend of talent, ambition, and government support, India is rapidly becoming a hub for transformative Deep Tech ideas. However, to solidify its global leadership, there’s a need for clear policy frameworks and strategic focus in the upcoming Union Budget 2025.

Evolution of India’s Deep Tech Ecosystem

Although still emerging compared to global leaders, India’s Deep Tech sector shows enormous promise. According to NASSCOM’s report, India’s DeepTech Dawn: Forging Ahead, the country hosted over 3,600 Deep Tech startups in 2023, with 480 new startups established that year—a twofold increase from 2022. While India ranks as the third-largest startup ecosystem globally, its Deep Tech sector is currently sixth worldwide.

Growth Drivers: Policies and Partnerships

The Indian government has actively supported the ecosystem with targeted initiatives such as the Draft National DeepTech Start-up Policy, a ₹1 lakh crore corpus introduced in the Interim Budget 2024, and a ₹1,000 crore Venture Capital Fund for the Space Sector.

Programs like the Atal Innovation Mission, NITI Aayog initiatives, and Start-up India further bolster the ecosystem, providing accelerators and incubators. Collaborations between top-tier academic institutions and industries in AI, robotics, and quantum computing have also catalyzed growth. Deep Tech companies with proprietary, cutting-edge IP are becoming attractive investment opportunities.

Overcoming Challenges

Despite this progress, significant hurdles remain, such as limited access to funding, infrastructure modernization, talent retention, and intellectual property protection. According to NASSCOM, 70% of Indian Deep Tech startups face funding constraints, with median ticket sizes being among the lowest globally. These challenges underscore the need for patient capital and robust policy intervention.

Expectations from Budget 2025

The upcoming Union Budget offers an opportunity to address these challenges and catalyze the Deep Tech sector’s growth. Key recommendations include:

1. Enhancing Access to Capital: Establish dedicated Deep Tech VC funds and long-term grants to support high-risk, high-reward innovations. Efficiently allocate the ₹1 lakh crore corpus and introduce co-investment models to attract private investments.
2. Developing Talent: Bridge skill gaps through industry-academia partnerships, specialized training programs in AI, robotics, and quantum computing, and continuous upskilling initiatives.
3. Strengthening IP Protections: Simplify IP registration, increase funding for enforcement, and establish IP commercialization hubs to help startups monetize innovations.
4. Boosting R&D Investments: Create world-class research hubs and support translational research to turn discoveries into market-ready solutions.
5. Startup Incentives: Extend tax holidays, provide R&D grants, and offer subsidies for patents and infrastructure to ease financial burdens.
6. Modernizing Infrastructure: Develop technology parks and innovation districts with advanced facilities to support startups.
7. Encouraging Global Collaboration: Foster international research partnerships and startup exchange programs to provide access to global markets and expertise.
8. Regulatory Simplification: Introduce fast-track approval mechanisms for emerging technologies and establish ethical frameworks for responsible AI and innovation.
9. Promoting Sustainability: Incentivize startups working on climate tech, renewable energy, and circular economy solutions to align with global environmental goals.

By addressing these areas, Budget 2025 can position India as a global leader in Deep Tech, fostering innovation that aligns with economic growth and societal impact.

Go!