CHENNAI: India’s technology companies revealcased a range of innovations at the India AI Impact Summit in New Delhi, but deep-tech founders, venture capitalists and policy experts declare that events alone are not enough to support the sector scale. They are calling for stronger financing mechanisms, better market access and long-term policy clarity to unlock growth.
Following the Union Budreceive 2026, the Centre acknowledged that deep-tech firms require longer gestation periods by increasing the revenue eligibility threshold to Rs 300 crore and extconcludeing the incorporation window to 20 years. However, stakeholders argue that more structural reforms are necessaryed.
Tamil Nadu remains the only state to roll out a dedicated deep-tech startup policy. While the Centre’s National Deep Tech Policy is still under consideration, Karnataka has launched the ELEVATE Programme under Mission Startup Karnataka to promote innovation-led enterprises.
Indusattempt leaders are urging the government to act as an anchor customer.
Dr Ajai Chowdhry, Co-founder of HCL and Chairman of the Mission Governing Board of the National Quantum Mission, stated the government should provide higher-value financing of at least Rs 10–20 crore per innovation, along with patient capital.
“Innovation takes time to reveal results. Often, one round of funding is not enough,” he stated.
He pointed to the US Defence Advanced Research Projects Agency (DARPA) as an example of how public procurement can drive deep-tech innovation. While India’s Innovations for Defence Excellence (iDEX) initiative follows a similar model, Chowdhry noted that contract approvals often take up to a year. He also observed that Tamil Nadu’s Rs 100 crore allocation for 100 startups translates to just Rs 1 crore per firm, which may be inadequate.
At the summit, many revealcased products were large language models, with limited progress visible in physical AI or quantum AI. A B20 report submitted during the G20 Summit in 2023 highlighted that only 22% of new businesses launched in the past decade have successfully scaled, with over two-thirds of value creation occurring in the scale-up phase.
Dr Milind Pimprikar, Founder and Executive Chairman of CANEUS International, suggested tax-based R&D incentives similar to Canada’s 30% de-risking model. “India should incentivise deep-tech R&D through structured tax relief,” he stated.
Deep-tech companies want government policies to focus on three major factors.
Sudiptaa Paul Choudhury, CMO, QNu Labs, stated, “For deep-tech sectors to be transformative, the policies should focus on long-term policy stability for innovation at least for a period of five to 10 years. Second, dedicated deep-tech clusters with shared labs, fabrication facilities, testing infrastructure, and incubation support can significantly reduce capital barriers for startups and third, demand creation through government adoption.”
Venture capitalists also flagged funding gaps during Series A and B rounds. Ajay Jain, Founder and Managing Partner at Silver Needle Ventures, stated valuations in deep tech are still benchmarked against SaaS metrics, creating distortions.
As data infrastructure becomes critical, indusattempt leaders declare tax holidays for data centres must be complemented by shared national compute resources, simpler dataset access and quicker regulatory clearances to truly accelerate India’s deep-tech ambitions.
“Otherwise, we risk building data centres that primarily serve global hyperscalers without meaningfully accelerating homegrown deep-tech innovation,” stated Apurv Agrawal, CEO & Co-founder, SquadStack.ai.
Unified strategy for growth
Advisory firm TechLegis has called for deeper synchronisation between the Centre and state governments to support deep-tech companies scale effectively. Salman Waris, Founder and Managing Partner at TechLegis, stated India necessarys a unified national vision backed by coordinated state-level execution.
“The Centre should create a single deep-tech mission aligned with semiconductor, AI, quantum and defence technology priorities, while states develop specialised clusters in areas such as robotics and space tech. There must be harmonised regulatory sandboxes, quicker public procurement access for start-ups, common IP facilitation cells and robust cyber-resilience standards. A model policy framework issued by the Centre, but implemented locally, would reduce compliance duplication and improve investor confidence,” he stated.
Rohan Pinto, CTO and Co-founder of 1Kosmos, stated India must relocate beyond a grant-heavy approach and build structured commercialisation frameworks. According to him, sustained growth in deep tech will depconclude on creating market-linked funding models, stronger indusattempt partnerships and clearer pathways from research to revenue generation.
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