Tech-novation by BIS Research: India at the Forefront of DeepTech Innovation

Faisal

Good evening, everyone, and welcome to the inaugural episode of Tech-novation by BIS Research! I'm Faisal, your host for today’s session, and I’m thrilled to be joined by Neha, an insightful co-host. Today, we’re diving into the exciting world of deep-tech innovation in India. From specialized infrastructure to government policies, we’ll explore how India is on the brink of becoming a global leader in this transformative space. Neha, what are your thoughts on the current state of deep-tech in India?

Neha

Hi, Faisal! I’m really excited to be here. The deep-tech landscape in India is truly dynamic. I’ve been following some startups in the biotech and quantum computing sectors, and they’re making some groundbreaking advancements. But, as you mentioned, they face unique challenges. What kind of infrastructure improvements do you think are most urgently needed to support these startups?

Faisal

Absolutely, Neha. Deep-tech startups need specialized infrastructure like research labs, clean rooms, advanced manufacturing facilities, and high-performance computing clusters. For example, semiconductor and biotech startups require sophisticated equipment and high-tech environments. While initiatives like Atal Innovation Mission’s Tinkering Labs exist, they’re not sufficient for deep-tech sectors. We need labs with advanced computational power, like the Quantum Technology and Application Lab in Hyderabad, but we need more of them. Beyond research labs, efficient logistics, high-quality office spaces, and proximity to research hubs are also crucial. This infrastructure will help startups collaborate effectively with universities and other institutions.

Neha

That’s a great point. I’ve heard about the success of clusters like Boston’s Kendall Square, which is a global hub for biotech and AI. Could we see something similar in India, perhaps in cities like Bengaluru or Hyderabad? How would that impact the deep-tech ecosystem?

Faisal

Definitely, Neha. Creating deep-tech clusters is crucial. Bengaluru is already a key tech hub, but deep-tech requires a more focused ecosystem. Imagine a Bengaluru where research institutions, universities, and deep-tech startups are in close proximity, all working together. For instance, Hyderabad’s T-Hub is one of India’s largest incubators, but it’s mostly geared toward software startups. We need similar initiatives designed specifically for deep-tech sectors—be it quantum, AI, or biotech. This will create synergies that will help scale startups quickly and ensure they have access to the resources and talent they need.

Neha

I can see how that would be transformative. Speaking of government support, the National Deep Tech Start-up Policy 2023 and the National Mission on Quantum Technologies are significant steps. How do you see these policies impacting the growth of deep-tech in India?

Faisal

These initiatives are monumental, Neha. The National Deep Tech Start-up Policy 2023 addresses the unique challenges of deep-tech ventures—high R&D costs, longer timeframes, and the need for specialized talent. It provides tax incentives, grants, and encourages public-private partnerships, which are essential for startups in fields like AI, robotics, and quantum computing. Similarly, the National Mission on Quantum Technologies focuses on making India a global leader in quantum research. Quantum technologies are expected to revolutionize fields like cryptography, AI, and material science, but they need significant funding and expertise. These policies help channel resources into areas with transformative potential, offering both financial support and infrastructure development.

Neha

Wow, those policies sound like they could really make a difference. The Anusandhan National Research Foundation (ANRF) can also play a crucial role in supporting deep-tech R&D. How do you see its impact?

Faisal

ANRF is vital for deep-tech development, Neha. Deep-tech startups, especially in fields like quantum computing or biotech, face a unique challenge in securing funding. The early-stage R&D required is expensive, and traditional investors are hesitant due to long timelines. ANRF can bridge this gap by providing dedicated funding to high-risk, high-reward projects. For instance, startups working on gene-editing technologies or AI-based healthcare solutions need substantial funding during their R&D phase before they can scale. ANRF can help ensure these projects get the financial backing they deserve.

Neha

That’s a crucial point. Funding for deep-tech is different from traditional tech ventures, requiring long-term investment. Now, turning to venture capital, we’re seeing more VC interest in deep-tech. How do you see the trends in venture funding for deep-tech startups in India?

Faisal

We’re definitely seeing a shift, Neha. Historically, VCs were cautious about deep-tech due to its long gestation periods. But as investors realize the immense potential of sectors like AI, quantum, and biotech, there’s a growing willingness to back these startups. The key difference today is that investors are willing to wait longer for returns. For example, QNu Labs, a quantum computing startup in India, raised funding to develop quantum-safe encryption technology. This kind of long-term investment is crucial. Startups like QNu show that when investors recognize the transformative potential of deep-tech, they’re more likely to support these ventures through their early, high-risk phases.

Neha

That’s encouraging. But as you mentioned earlier, one of the biggest challenges for deep-tech startups is talent acquisition. Deep-tech requires highly specialized skills. How do we bridge the talent gap?

Faisal

Talent is critical, Neha. While India produces millions of engineering graduates, deep-tech requires a different skill set. We need scientists, researchers, and engineers who are experts in fields like physics, biology, and advanced mathematics. Universities must adapt curriculums to focus on interdisciplinary skills and real-world applications. Additionally, there should be more collaborations between universities and deep-tech companies. For instance, institutes like IITs and IISc have started integrating deep-tech into their research programs, focusing on areas like AI and quantum computing. This collaboration ensures that graduates are industry-ready and equipped with the right skills.

Neha

Exactly. The synergy between academia and industry is key to building a sustainable talent pipeline. Finally, for government-backed venture funds supporting deep-tech startups, what strategies would you recommend to help startups in their early R&D phases?

Faisal

Government-backed funds should focus on long-term growth, Neha. Startups in deep-tech need more than just financial support—they need patience and the right kind of mentorship. These funds should offer longer investment horizons and work on creating bridges between academia, industry, and startups. By supporting the full lifecycle of innovation, from R&D to commercialization, government-backed funds can help India become a global leader in deep-tech.

Neha

That’s a comprehensive approach. Faisal, this has been an incredible discussion. The future of deep-tech in India is certainly bright, but it will require a collaborative effort between the government, industry, and academia. Thank you so much for your insights today. It’s been a pleasure.

Faisal

Thank you, Neha. It’s been a fantastic conversation. And thank you to our viewers for joining us on this inaugural episode of Tech-novation by BIS Research. We hope today’s discussion was insightful. See you next month with another exciting live session and another leader in the deep-tech space. Have a great day ahead!