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As India strives to become the world’s leading startup ecosystem, one area of focus stands out—deeptech. Amitabh Kant, G20 Sherpa for the Government of India, said the next major step in solidifying India’s position on the global stage is the creation of a dedicated Rs 25,000 crore fund of funds to support deeptech innovations.

“The big-ticket thing is a Rs 25,000 crore fund of funds for the deeptech sector,” Kant said, stressing that while the country has made significant progress with its existing fund for startups, a specialised deeptech fund is essential for nurturing breakthrough technologies like artificial intelligence (AI), quantum computing, robotics, and biotech.

“India has a lot of capital; we need not depend on foreign capital. People need to take a little risk along with the venture capital firms in startups,” he said, speaking at YourStory‘s startup-tech event, TechSparks 2024, in Bengaluru.

Kant’s call to action underscores the importance of mobilising domestic capital to power India’s technological future. While foreign investment has been crucial in the growth of India’s startup ecosystem, Kant believes it’s time for Indian investors to step up and take calculated risks in the deeptech space.

“We need Indians to put money into startups—India’s insurance sector and pension funds should contribute after due diligence,” he said, underscoring the role of local financial institutions in strengthening the ecosystem.

India has already demonstrated the impact of strategic policy shifts, particularly in sectors like space, geospatial, and semiconductors, where recent reforms have opened up new avenues for innovation. Kant believes the momentum should continue.

“We should keep opening up more and more sectors like we’ve done with space, drones, geospatial, and semiconductors,” Kant noted.

According to a NASSCOM report, India houses over 1,600 deeptech startups, with a total market size of $14 billion.

A deeptech fund of funds would provide the financial backing to spur breakthrough innovations, accelerate research, and foster startups that focus on high-impact, long-term technological solutions.

With over a 100 unicorns and a thriving entrepreneurial landscape, India has become the world’s third-largest startup ecosystem, but the path to becoming number one lies in nurturing deep technologies, said Kant.

“We have become the third-best startup ecosystem; our aim is to be the world’s number one,” he added.