Deep Tech Startups : Government Launches Draft Policy to Address Issues 2023
As of May 2023, 10,298 DPIIT-recognized firms were categorized throughout several sub-sectors within the greater deep tech area, according to Startup India’s database.
The Government unveiled a draught national deep tech startup strategy on Monday to address entrepreneurs’ difficulties and propose legislative changes to strengthen the ecosystem. Public comments on the draught policy are welcome until September 15.
The Atmanirbhar Bharat imperative, progressing towards a knowledge-driven economy, enhancing national capability and sovereignty, and encouraging ethical innovation are the four main pillars of the policy released by a group led by a principal scientific adviser to the Government, Ajay Kumar Sood.
According to many criteria, including maturity levels, applicability to diverse industries, periods and geographic restrictions, and contextual relevance, the policy has designated deep tech startups according to several aspects.
The policy defines a deep tech startup as developing early-stage innovations based on scientific or technical breakthroughs that must still be designed for commercial uses. It further stated that a deep tech company often develops a solution along an untried road based on a fresh understanding of science or engineering or by fusing knowledge from other fields.
According to Startup India’s database, as of May 2023, there were 10,298 DPIIT-recognized firms categorized across several deep tech sub-sectors.
Through this strategy, the Government’s top aims include encouraging research, development, and innovation, bolstering the intellectual property system, easing financial access, enabling infrastructure access and resource sharing, standards, and certifications, among other things.
The proposal also suggests a group called The Centre for Deep Tech Translation to evaluate Indian research (publications, patents, etc.) for future commercialization.
The Government has taken an unprecedented step towards fostering innovation in deep technology, marking a pivotal moment in the country’s technological advancement. In a move that echoes its dedication to the startup ecosystem, the Government has recently unveiled a draft policy addressing the unique issues plaguing deep tech startups.
Deep tech startups are companies built on substantial scientific or engineering innovation. They typically operate in fields such as artificial intelligence, robotics, quantum computing, biotechnology, blockchain, etc. Deep tech startups stand at the intersection of science and entrepreneurship. They are usually characterized by long gestation periods, high research and development costs, and highly specialized talent requirements.
Despite their potential to disrupt markets and change the status quo, deep tech startups face unique challenges. These include lack of funding due to high risk and long-term return on investment, scarcity of specialized talent, lack of market readiness, and regulatory hurdles. Recognizing these challenges, the Government has proposed this draft policy to streamline operations, facilitate growth, and cultivate a conducive ecosystem for these startups.
The policy includes comprehensive measures designed to tackle the deep-rooted issues faced by deep-tech startups:
- Establishment of Special Innovation Zones: The policy proposes establishing Special Innovation Zones (SIZs) that will act as incubation centres for deep tech startups. These zones will provide startups with state-of-the-art infrastructure, access to high-speed internet, and co-working spaces. They will also encourage collaboration and knowledge sharing among startups and create synergies between academia and industry.
- Funding Support: Acknowledging the high costs and risks associated with deep tech startups, the Government plans to set up a dedicated fund. This fund will be tailored to support startups at different stages of their lifecycle, from seed funding to later-stage venture capital.
- Access to Talent: The policy acknowledges the need for specialized talent in deep tech fields. Therefore, it envisages partnerships with universities and research institutions to create tailored courses that nurture the required skill. Additionally, it proposes relaxed immigration policies to attract international talent in specialized fields.
- Regulatory Framework: The policy addresses the need for a supportive regulatory framework. It aims to remove red tape and regulatory hurdles that impede the growth of deep tech startups. It proposes a ‘Regulatory Sandbox’ model that allows startups to test their innovations without the usual regulatory constraints.
- Market Access and Collaboration: Recognizing the importance of early market access for these startups, the policy proposes the creation of a platform for startups to collaborate with established companies and government agencies. This initiative is expected to facilitate market access and provide opportunities for proof-of-concept and pilot projects.
Launching this draft policy signals the Government’s recognition of deep tech as a crucial component of the country’s future economic growth. It is a promising step towards creating an environment conducive to the flourishing of deep-tech startups. The policy’s success will hinge on efficient implementation and regular feedback from the startup community to ensure the policy remains dynamic and responsive to changing needs.
The draft policy is open for public comments, and stakeholders across the startup ecosystem are encouraged to provide their input. Through collective wisdom and participation, the policy will evolve into a robust framework that significantly boosts the growth of deep tech startups in the country.
While numerous challenges are still on the horizon, the draft policy is a significant milestone. If successfully implemented, it could usher in a new era of technological innovation and growth, positioning the country at the forefront of the global deep tech industry.
