Funding, market framework for deep-tech startups in two months

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₹1 trillion government fund to support companies in promising segments struggling for capital. Setting up the fund for deeptech companies, first proposed in the interim budget in February, is part of the government's to-do list for the first 100 days in power.

An inter-ministerial committee led by the Department of Space is working on a framework for the fund, in coordination with the central government's principal scientific advisor, three officials familiar with the matter said, adding it will be announced in the next two months. The fund will be part of India's National Deeptech Startup Policy.

The framework may identify sectors such as advanced semiconductors, high-tech manufacturing, space, defence technologies, specialized artificial intelligence applications and quantum computing as deeptechs eligible for state aid, said one of the three officials cited above, all of whom spoke on the condition of anonymity. Apart from access to capital, the framework will also “focus on nurturing research, innovations and standards, and strengthen market access" for deep-tech ventures, one of the officials cited above said.

Industry stakeholders said that while the finance minister’s 1 February announcement was reassuring, the policy framework will be key in explaining which startups would be eligible, and push to help startups develop niche technology-driven products in India. Ajai Chowdhry, chairman of electronics industry body Epic Foundation, said that the key objective of the deeptech policy framework will be to boost R&D in the private sector which, in turn, will help make India a nation that builds and designs its own products, and not just offers services.