Context
∙ The Principal Scientific Advisor to the Government of India informed that the ‘Deep Tech’ Policy was sent to the Union Cabinet for approval.
Background
∙ The Union government unveiled a ‘Draft National Deep Tech Startup Policy (NDTSP)’ in July 2023 for public comment.
∙ It proposes a comprehensive policy framework to address the needs and strengthen the Indian Deep Tech Startup Ecosystem.
∙ It claims that there are more than 10000 startups recognised by the Department for Promotion of Industry and Internal Trade (DPIIT), under Union Ministry of Commerce and Industry which are classified across various sub-sectors within the larger deep tech space.
National Deep Tech Startup Policy (NDTSP)
∙ It is strategically formulated to stimulate innovation, spur economic growth, and promote societal development through the effective utilisation of deep tech research-driven innovations.
∙ It centralises on bolstering deep tech startups, thereby solidifying India’s financial stability and stimulating the transition towards a knowledge-centric economy, consequently augmenting India’s overall productivity.
∙ Vision (Deep Tech of India):
∙ Ensuring the Security of India’s Economic Future;
∙ Facilitating a Seamless Transition to a Knowledge-Driven Economy;
∙ Bolstering National Capability and Sovereignty through the Atma Nirbhar Bharat Imperative; and
∙ Fostering Ethical Innovation
∙ Thematic Priority:
∙ Nurturing Research, Development & Innovation; Strengthening the Intellectual Property Regime; Facilitating Access to Funding; Enabling Shared Infrastructure and Resource Sharing; Creating Conducive Regulations, Standards, and Certifications; Attracting Human Resources & Initiating Capacity Building; Promoting Procurement & Adoption; Ensuring Policy & Program Interlinkages; and Sustaining Deep Tech Startups.
Significances
∙ Nurturing the Research, Development & Innovation Ecosystem: The Policy proposes an increase in Gross Expenditure on R&D to provide renewed impetus to basic Research, Development & Innovation with aim of emerging science base for deep tech startups; and the critical base of trained scientific human resources.
∙ It aims to suitably amend the existing research assessment practices at academic institutes and research labs to enable translation of knowledge outputs into entrepreneurial outcomes.
∙ Technology Commercialisation: By creating seamless partnerships between academic institutions, research labs and industry;
∙ Platforms and technology commercialisation offices within academic institutes and research labs and providing;
∙ It aims to promote innovation in fields such as AI, Blockchain, biotechnology, drones, and quantum computing.
∙ Open Science and Data Sharing Platform: The policy promotes setting up an Open Science and Data Sharing platform for encouraging collaboration and knowledge sharing among the stakeholders to promote deep tech innovations.
∙ It aims to incentivise faculty members, through suitable amendments in their appraisal and assessment policies, to undertake entrepreneurial risk.
∙ Strengthening India’s Intellectual Property Rights (IPR) Regime: By measures like:
∙ Establishing a Single Window Platform that enables an Unified IP Framework;
∙ Customised for deep tech startups;
∙ Guidelines on creation of Design IPs leading to greater strength in respective technology competencies;
∙ Guidance on streamlining the patent application process; and
∙ Unified database from all Higher Education Institutes (HEIs) populated with publication, patent and project information .
∙ Strengthening Global Competitiveness: The policy proposes to strengthen India’s position in global IP related convention, cross border IP protection, providing provisions in Free Trade Agreement (FTA) and establishing a well-defined mechanism for evaluating the suitable amendments in National IPR Policy.
∙ Enable Shared Infrastructure and Resource Sharing: The policy aims to provide access to shared infrastructure, for a nominal fee wherever necessary, is key to reducing initial capital expenditure for the startups.
Major Concern
∙ Funding: Currently in India, only about 10% of startups are ‘deep tech’.
∙ Investments in 2023 hit a five-year low of $7 billion, taking India’s global ranking from third to fourth place.
∙ Funding declined across all stages, with late-stage funding witnessing the biggest drop of 73%, to $4.2 billion in 2023 so far.
∙ The quantum of funds in ‘deep tech’ needed is vastly larger, unlike startups focussed on fintech or retail software.
∙ Competition from China: India stood second in terms of research in technologies, including biofuels, smart materials, advanced composite materials, and high-specification machining processes.
∙ China’s global lead was spread across defence, space, robotics, energy, environment, biotechnology, artificial intelligence (AI), and quantum technology.
∙ Other key barriers such as resource and infrastructure constraints, and understanding risks associated with frontier technologies.
Way Forward
∙ Funding is a key driver of a startup’s growth journey, and access to long-term finance is particularly critical for deep tech startups for product development, validation, and scaling.
∙ It is essential to Facilitate Targeted Long-term Funding for deep tech startups, and there is a need to address the key barriers for the best utilisation of deep tech.∙ There are International Initiatives within the Indian Deep Tech Startup ecosystem, like the Indo-US Joint Working Group on Artificial Intelligence (2020); the Indo-Israel Deep Tech & Life Sciences Mission; the Indo-Japan Deep Tech & Startups Partnership from which India can utilise effectively and efficiently in the field of deep tech
