India is preparing to invest $25 billion to support the development of domestic deep-tech startups. The country hopes to catch up with the United States and China in the global tech race and reduce its dependence on cutting-edge technologies from abroad.
The president of the Indian Venture Capital and Alternative Capital Association (IVCA), Rajat Tandon, told CNBC that over the past decade, India has invested $11.6 billion in the field of deep technology.
However, he stated that currently, the government alone has committed to investing $11 billion through the 'R&D Infrastructure Fund', and this amount will also be supplemented by venture capital and private equity fund managers.
Tandon said that in addition, another $3 billion to $4 billion will be added, bringing the total amount of funds "available for deep-tech investment to $25 billion."
Deep technology is a broad concept that usually refers to startups in fields such as artificial intelligence, semiconductors, advanced manufacturing, drones, and aerospace technology. Experts interviewed by CNBC stated that with the intensification of geopolitical tensions, governments have realized that cutting-edge technologies have become "very critical," hence they have promoted this round of financing to provide support.
Currently, China and the United States are in a leading position in the global artificial intelligence competition. At the same time, Chinese technology is met with skepticism in India, while Washington's restrictions on technology exports make American technology seem less reliable.
Crane Venture Partners Managing Director Anandamoy Roychowdhury stated: "The additional tariffs imposed by the United States are actually of great help to this (deep technology) field." He added that India will develop its own deep technology companies because the country is concerned that "important technologies could be cut off at any time."
Some of these concerns came to fruition in June of this year. At that time, Anthropic ceased to make its new models Fable 5 and Mythos 5 available to foreign nationals in order to comply with a U.S. government export control directive.
The person in charge of financing for startups attending the SuperReturn Asia conference stated that India's deep-tech companies are still in their early stages, but given the high quality of creativity and talent in the country, this ecosystem is ultimately expected to give rise to global leaders.
Startup Policy Forum President and CEO Shweta Rajpal Kohli stated that there is a "significantly accelerated innovation" in the field of deep technology in India, and added that some companies are moving from the prototype stage to "true commercialization."
Earlier this year, Vibe-coding startup Emergent, aerospace technology company Skyroot, and Indian full-stack sovereign AI firm Sarvam all achieved a valuation of over $1 billion in their latest round of financing, becoming unicorn companies.
"Like walking into a candy shop"
Roychowdhury, who is part of Crane Ventures, said when talking about his experience in searching for investment opportunities in deep-tech startups in India: "I felt like a child walking into a candy store." He revealed that currently, about 80% of the funds from his $150 million Asia-Pacific fund are being directed towards India.
IVCA stated in a report in August of this year that its survey of 100 funds in India revealed that 9 out of those 10 funds were allocating capital to deep-tech startups, with 37% of the funds holding shares in 11 to 20 such companies.
The report adds that in 2025, the industry received nearly $3 billion in financing, setting a new historical high, despite a decline in overall financing for startups in India during the same period. However, the report also highlights the significant financing gap with the United States: the US received $136 billion in financing during the same time frame.
Compared to their American counterparts, a major disadvantage of Indian deep-tech startups is the lack of sufficient capital domestically to support such long-term, highly innovative investments and to achieve scale.
The Tandon of IVCA states: 'The challenge we face in India today is that only 2% of the population has the capability to issue checks for over 10 million US dollars.' He added that high-net-worth individuals and family offices need to increase their investments in order to drive the development of deep technology in India.
