India vs China: 7 Shocking Reasons Why India Must Supercharge Its Deep Tech Game Now!
India’s Commerce Minister, Piyush Goyal, recently urged startups to move beyond food delivery and fantasy gaming, and instead focus on deep tech—fields like AI, semiconductors, and robotics. He pointed to China’s success, where startups are solving real-world problems and driving national progress through cutting-edge innovation. Backed by massive government funding, dedicated tech zones, and long-term planning, China has built a thriving ecosystem for advanced technologies.
In comparison, India faces challenges like limited tax revenues, a smaller R&D workforce, and heavy reliance on imported tech components. Although initiatives like the ₹10,000 crore AI mission and deep tech funds are a start, India still lacks the scale and cohesive strategy seen in China. To catch up, India must cultivate a culture of high-risk, high-reward innovation and provide strong support to founders aiming to solve complex problems. Deep tech has the potential to make India a global leader, but it demands serious long-term investment, collaboration, and vision.
The opportunity is real—India just needs to seize it boldly and strategically.
India vs China: 7 Shocking Reasons Why India Must Supercharge Its Deep Tech Game Now!
India’s Commerce Minister, Piyush Goyal, recently sparked a debate at the Startup Mahakumbh by urging Indian startups to aim higher. While applauding their growth in sectors like quick-delivery apps, food brands, and fantasy sports, he questioned whether these ventures truly drive innovation. Instead, he pointed to China, where startups are tackling complex challenges through advancements in semiconductors, artificial intelligence (AI), robotics, and biotechnology. The big question: Can India follow China’s path to becoming a deep tech powerhouse?
What Exactly is Deep Tech?
Deep tech refers to innovations rooted in cutting-edge science and engineering to solve real-world problems. Unlike apps or consumer brands focused on convenience, deep tech has the potential to transform industries, economies, and even societal structures. Think AI-driven drug discovery, quantum computing, or advanced chip manufacturing—solutions that address global challenges like healthcare, energy, and sustainability.
China’s Strategic Playbook
China’s dominance in deep tech didn’t happen overnight. It’s the result of long-term planning, heavy funding, and focused policy. In 2015, the government launched the Made in China 2025 initiative, prioritizing high-tech sectors like robotics and green energy. Later, the 14th Five-Year Plan (2021) emphasized self-reliance in technology and sustainable growth.
The government didn’t just set goals—it took action. State-backed venture capital poured billions into startups. Tech hubs like Shenzhen became innovation ecosystems, blending research labs, manufacturing units, and skilled talent. For instance, in semiconductors, China funded chip design institutes, built factories, and incentivized local companies to use domestically produced chips through tax breaks.
Examples of China’s Success:
- AI & Robotics: Companies like SenseTime and DeepSeek are global leaders in facial recognition and AI models rivaling ChatGPT.
- Semiconductors: Despite U.S. sanctions, firms like Biren Technology have developed advanced chips for AI and supercomputers.
- Biotech: Startups like XtalPi use AI and quantum physics to cut drug development time from years to months.
- EVs & Batteries: BYD and CATL dominate the global electric vehicle and battery markets, backed by state subsidies and R&D grants.
Why India Struggles to Keep Up
While India has a vibrant startup culture, shifting focus to deep tech isn’t straightforward.
- Funding Gap:
China’s 2024 tax revenue (₹200 lakh crore) is five times India’s, enabling massive R&D investments. China spends nearly $500 billion annually on research—India allocates just $23.45 billion. Limited tax revenue (with only 5% of Indians paying income tax) restricts India’s ability to fund innovation at scale. - Talent Shortage:
China boasts over 2 million R&D professionals—double India’s count. While India produces skilled graduates, many migrate abroad for better opportunities. Retaining talent requires competitive salaries, world-class labs, and collaborative projects—areas where India still lags. - Dependency on Imports:
Despite the “Make in India” push, the country still relies heavily on imported tech—from AI chips to pharmaceutical ingredients. Building domestic capabilities in sectors like semiconductor manufacturing demands time, expertise, and infrastructure India has yet to fully develop. - Risk-Averse Culture:
Deep tech projects require patience. Developing a breakthrough chip or AI model can take a decade, with high failure risks. Indian startups, often pressured by investors for quick returns, tend to favor low-risk, consumer-focused models.
Glimmers of Hope
India isn’t sitting idle. The government has launched initiatives like a ₹10,000 crore AI mission and a ₹20,000 crore fund to boost private R&D. States like Karnataka and Telangana are creating tech corridors, while institutions like IITs are partnering with industries for research. Startups like Agnikul (space tech) and Pixxel (satellite imaging) show promise in niche areas.
The Road Ahead
To replicate China’s success, India needs a three-pronged approach:
- Long-Term Funding: Increase R&D spending to at least 2% of GDP (currently 0.7%) and offer tax incentives for deep tech ventures.
- Skill Development: Revamp education to emphasize research, collaborate with global universities, and create attractive opportunities to retain talent.
- Public-Private Partnerships: Encourage joint ventures between startups, corporations, and research bodies to share risks and resources.
Minister Goyal’s critique is a wake-up call. India has the potential—boasting the world’s third-largest startup ecosystem—but needs a strategic shift. By balancing consumer innovation with ambitious deep tech projects, India could transition from a service-driven economy to a global tech leader. The journey won’t be easy, but with sustained effort, the next decade might tell a different story.