Piyush Goyal Gives A “Reality Check” To Indian Startup Ecosystem
“I have a lot of nice things that I could talk to you about, but I have a slide that I want to show you that disturbed me a lot,” commerce and industry minister Piyush Goyal said during his address at the Startup Mahakumbh today. This came after the minister heaped praises on the country’s burgeoning startup ecosystem, and was his attempt to nudge investors and entrepreneurs to change their priorities and think about big innovations.
During his speech on the inaugural day of the three-day event, Goyal presented a slide, titled “India Vs China: The Startup Reality Check”, which he said someone shared with him a few days ago. It compared the tech innovations in the two countries.
The slide compared blooming Indian startup sectors like foodtech, D2C and quick commerce with China’s dominance in deeptech sectors like EVs, semiconductors, AI and robotics.
Goyal addressed almost each of these comparisons and expressed concerns over how Indian innovations are tilted towards convenience-oriented businesses.
“My reply to this was “very inspiring” and I want each one of you to take some inspiration from this. Some might call me out for comparing with other nations, but I don’t have qualms about that. We are the world’s third-largest startup ecosystem and we should aspire to be the largest in the near future,” Goyal added.
Starting off with the comparison of food delivery with EV and battery tech, he said India as a nation has been obsessing over food deliveries while our neighbouring country has fortified its tech solutions in the aforementioned deeptech sectors.
While China has been advancing its tech play, the Indian startup ecosystem is focussed on food delivery apps, which utilise the cheap labour of unemployed youth, he said.
Goyal also said that many startups in India are selling ice creams by packaging them in an appealing way and labelling them as healthy, which is seldom the case.
“Are we going to make ice cream or chips?… Aman Gupta, change your investment perspective on Shark Tank!” he remarked.
Gupta, the cofounder of boAt and a judge on TV show Shark Tank India, was among the audience during the address.
The minister also raised the issue of dearth of domestic capital, which he said has led to foreign investors acquiring Indian startups.
“When it comes to instant grocery delivery, I don’t have problems, they can list at a few billion dollars, I will be really happy. I only wish that they had more Indian investors rather than foreigners buying all of our startups,” the minister said.
His comments come on the heels of quick commerce major Zepto and ecommerce giant Flipkart firming up their plans to list on the bourses. While Zepto is backed by foreign investors like General Catalyst, Y-Combinator and Lightspeed, Flipkart is owned by US-based retail giant Walmart.
Earlier in the day, Indian Angel Network cofounder Padmaja Ruparel also highlighted how to overseas players due to a lack of domestic capital.
While China is also home to a number of foodtech and quick commerce players, Goyal’s comments were aimed at encouraging Indian entrepreneurs and investors to take more risks and come out with innovations in the deeptech sector.
During a session at the Startup Mahakumbh earlier in the day, Peak XV Partners’ Rajan Anandan and expressed confidence that the country would emerge a leader in the sector. However, Goyal shared his displeasure with the current state of deeptech in India.
Pointing out that the country is home to a very few active deeptech startups, the minister said that the propagation of innovations in such fields is imperative to establish India as a global innovation hub.
“When I look at deeptech, the numbers are a disturbing sign. Wealth creation in the short term may happen with some of these conveniences. But are we looking at dukaandari
In a bid to promote deeptech in India, the Startup Mahakumbh is also hosting a couple of competitions to promote innovations in sectors like cybersecurity, AI, robotics, biotech, among others. The price pool of these competitions is pegged at over INR 70 Cr.
Goyal called for a larger pool of INR 500 Cr worth cash prizes for contests hosted at the next edition of the event. He urged defence ministry, Nasscom, and unicorns to pitch in to make the pool larger moving forward.
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