India's Innovation Imperative: Beyond 'Jugaad' to a Frontier Tech Ecosystem

What is the core challenge in shifting from 'jugaad' to deep tech?

The core challenge is transitioning an ecosystem celebrated for cost-effective, improvisational solutions ('jugaad') to one that systematically creates and scales globally competitive 'frontier technology'. While India has made significant strides, climbing to the 40th position among 132 economies in the Global Innovation Index 2023 (Source: World Intellectual Property Organization), the character of its innovation has been predominantly in software and services. The difficulty lies in building capabilities in capital-intensive and research-heavy domains like semiconductors and advanced material sciences. The global contest over semiconductor technology, exemplified by the U.S. CHIPS and Science Act, underscores the strategic vulnerability of being a technology 'deployer' rather than a 'creator'. As a recent analysis in The Hindu notes, while becoming an "AI deployment superpower" is one path, the larger field of opportunities in deep tech remains an "open contest."

What has been the government's policy approach?

The government's strategy has evolved from broad-based support to a targeted focus on deep tech. The foundational policy was the Startup India Action Plan, launched on January 16, 2016, built on pillars of simplification, funding support, and industry-academia partnership. Under this, the DPIIT has officially recognized over 1,17,000 startups as of late 2023. A key financial instrument is the Fund of Funds for Startups (FFS) Scheme, with a ₹10,000 crore corpus. The FFS does not invest directly in startups but in SEBI-registered Alternative Investment Funds (AIFs), which then fund emerging companies.

To cultivate innovation at the grassroots, the Atal Innovation Mission (AIM) under NITI Aayog has established over 10,000 Atal Tinkering Labs in schools. More recently, the policy focus has sharpened. The draft National Deep Tech Startup Policy (NDTSP), released for consultation in August 2023, explicitly addresses the unique challenges of deep tech ventures, such as long gestation periods and high capital needs. It proposes interventions across nine themes, including nurturing R&D and facilitating access to patient capital, signalling that a different policy toolkit is required for deep tech.