India Must Build Global Deep Tech Champions, Investors Urge at AI Summit
India needs to shift its focus from incremental improvements and instead concentrate on developing globally competitive deep technology companies. This was the consensus among leading investors at the AI Impact Summit held on Tuesday. They argued that the nation's inherent frugality and massive scale could uniquely position it as a long-term hub for innovation on the world stage.
Frugality as a Catalyst for Innovation
Siddarth Pai, the co-founder of 3one4 Capital, provided a compelling perspective on why India's environment is ripe for breakthrough innovations. "The chaos that's inherited in India and the frugality that's there breeds innovation. The moment you have a large amount of surplus, you never look at optimisation. The greatest deep tech innovations across the world have always happened from a place of frugality," Pai stated emphatically.
He further elaborated that India's structural constraints should not be perceived as disadvantages. Instead, these conditions force entrepreneurs and engineers to pursue sharper engineering solutions and achieve greater capital efficiency, turning challenges into competitive advantages.
Thinking Big and Targeting Global Markets
Kris Gopalakrishnan, co-founder of Axilor Ventures and Infosys, urged Indian founders to adopt a global mindset from the very inception of their ventures. "What's required is to think big. We have examples of technology from India going global. Our MOSIP open-source identity programme is running in 29 countries; 300 million people got IDs with that...," Gopalakrishnan highlighted, pointing to existing successes as a blueprint for future endeavors.
He acknowledged that foundational technologies like artificial intelligence, robotics, and quantum computing demand patient capital and supportive policy innovations. However, Gopalakrishnan identified the larger opportunity in the application of these deep technologies across critical sectors such as agriculture, healthcare, and education, where India's scale can drive transformative impact.
Surge in AI and Deep Tech Investments
A significant report released during the summit underscored the rapidly growing investor interest in AI and deep technology within India. The data revealed a remarkable surge:
- In 2025, AI companies attracted 188 investments totaling $1.2 billion, marking a substantial 58% year-on-year increase.
- AI now constitutes 12% of the total venture capital funding in the country, a significant rise from under 5% recorded in 2020.
- Since 2016, nearly $28 billion has been invested across more than 2,100 deep tech deals in India.
- This segment now represents 15% of the overall private equity and venture capital activity, highlighting its growing importance.
Challenges in Scaling and Growth-Stage Funding
Despite the positive momentum, the report also pointed to critical challenges that could hinder India's ambition to produce global deep tech leaders. It noted that while early-stage capital availability has strengthened considerably, growth-stage funding remains notably limited. Furthermore, the absence of large, specialist deep tech funds in the country could pose a significant constraint on the ability of Indian startups to scale their operations and compete effectively on the international stage.
The collective message from the summit was clear: India possesses the unique ingredients—frugality, scale, and a growing investment ecosystem—to build world-class deep tech companies. The path forward requires founders to think globally, investors to provide patient capital, and the ecosystem to address the funding gaps at the growth stage to fully realize this potential.
