MAKE IN INDIA: Technology enabled development: The right way forward

By Ishita Sirsikar, Strategic Investment Research Unit As a part of the webinar series being organised by the government across various sectors to facilitate the efficient understanding and implementation of announcements made in the Union Budget, Prime Minister Narendra Modi addressed a webinar titled ‘Technology Enabled Development’. Through the same he made a strong plea for self-reliance in technology related sectors so as to harness the potential of technology to ensure last mile service delivery, as also to aid the process of employment generation. The Prime Minister stressed on the fact that the field of science and technology cannot be seen as an isolated sector, rather it complements other sectors like finance and the digital economy. The PM’s words derive strength from the Science, Technology and Innovation Policy (STIP) which was unveiled in 2020. Science, technology and more crucially, innovation are all approached holistically and pragmatically in the policy. Its goal is to refocus science, technology, and innovation on well thought out objectives, sectors and strategies. The said policy calls on the government to develop a strong scientific, technology and innovation ecosystem with a focus on translational research. This “science-for-society” mindset is a prerequisite for achieving Atmanirbhar Bharat. The important role played by technology becomes quintessential especially in the context of the last two years wherein the pandemic drastically affected not only our day to day functioning but also how we viewed different things. At a time when the world was already looking for efficient ways to use technology to minimise costs, time and efforts, the pandemic made it more of a necessity to find quicker alternatives to tasks that would otherwise be performed manually or would involve human contact. There has been a sizeable contribution made by the Internet of Medical Things (IoMT) in dealing with the current pandemic. The said technology has proven to be a much preferred alternative for disease monitoring and management owing to its efficient collection, analysis and transmission of health related data to the responsible departments. Further, the use of drones has gained a newfound momentum during the pandemic as they changed the entire concept of how things are delivered. GPS and Bluetooth are now being deployed to look out for disease carriers in our surroundings.

According to Bhaskar Mandal, head of Digital Industries, Siemens India, the only way India can strive towards achieving its vision of Atmanirbharta is through technology and the key players here would be Industry 4.0 and the fundamental digital technologies that emerge as a result of the same. In his address at the said webinar, Prime Minister Modi highlighted the importance of rapidly moving forward with our vision of Atmanirbhrta as other developed nations such as the US have also looked at achieving similar milestones in self-reliance during their march towards development. He therefore emphasised that “given the emergence of new global systems, it’s important that we keep moving forward”. The same point was also reiterated by Mr. Mandal, according to whom, rapidly evolving technology and concepts must be embraced in the industrial world to assure speed, flexibility, quality, and efficiency of production or assembly, as well as to enable new business models. Above all, the world’s resources being finite are becoming increasingly scarce, and thus we must all make more with less. We need to become more efficient and flexible in order to generate long-term innovation for the world we want to live in, now and in the future. Digitalization, and a complete and holistic digitalisation flow across all sectors, is the essential way forward.

The said webinar session also pointed out that based on the above understanding this year’s budget has placed special emphasis on sunrise sectors such as geo-spatial systems, artificial intelligence (AI), semiconductors, pharmaceuticals, 5G and clean technology. The Prime Minister also spoke about the need to not only being aware of the principles of science, but at the same time, making maximum use of technology to ensure an enhanced standard of living. Interestingly and importantly, India is among the few countries in the world whose constitution expressly mentions building “scientific temper” as a fundamental duty. According to article 51A of our constitution “scientific temper, humanism and the spirit of inquiry and reform is the fundamental duty of every citizen”.

In recent years, India has positioned itself as one of the world’s most rapidly developing science and technical economies. The government has looked at regulating technology imports by establishing a National Register of International Cooperation and implementing programmes like the Technology of Trading and Technology (TAAS) and Technology Transfer Cell (TTC). Further, telecommunications, computer systems, electronics, optics, and optoelectronics, chemical and polymers, and other specific materials are among the technology and application sectors handled by many specialists and niche organisations one of them being the Indian Space Research Organization (ISRO). It is important to note that technology transfer has displayed an exponential growth in the sectors handled by ISRO. India is well on its path of establishing itself as a global leader in various sectors. An example of this is seen in India’s efforts towards increasing its nuclear capacity through inventions and significant progress being made in the nuclear energy sector. Further evidence of the same is seen from the Agni-P which is India’s first shorter-range missile that uses upgraded rocket motors, propellants, avionics, and navigation systems similar to those found in the newer Agni-IV and Agni-V ballistic missiles.

To meet the aspirations of its people the government has rightly focused on critical sectors that are going to be the defining ones as we progress into the 21st century. The government’s focus on technology enabled development is another firm and focused step in this direction. Source: Invest India, Government of India

Startup ecosystem in India

Startup ecosystem in India India has emerged as the 3rd largest ecosystem for startups globally with over 63,100 DPIITrecognized startups across 638 districts of the country as of 07th February 2022. India ranks #2nd in innovation quality with top positions in the quality of scientific publications and the quality of its universities among middle-income economies. The innovation in India is not just limited to certain sectors. We have recognized startups solving problems in 57 diverse industrial sectors with 13% from IT services, 9% healthcare and life sciences, 7% education, 5% professional and commercial services, 5% agriculture and 5% food & beverages. Indian Startup Ecosystem has seen exponential growth in past few years (2015-2021):

• 9X increase in the number of investors.

• 7X increase in the total funding of startups.

• 7X increase in the number of incubators The Indian Unicorns are flourishing in the fast-paced and dynamic economy of today. These startups are not only developing innovative solutions and technologies but are generating large-scale employment. Till FY 2016-17, approximately one unicorn was being added every year. Over the past four years (since FY 2017-18), this number has been increasing exponentially, with a whopping 66% Year-on-Year growth in the number of additional unicorns being added every year. As of 09th February 2022, India is home to 88 unicorns with a total valuation of $ 295.99 Bn. Out of the total number of unicorns, 44 unicorns with a total valuation of $ 94.37 Bn were born in 2021 and 7 unicorns with a total valuation of $ 9.12 Bn were born in 2022.

Unicorn elements

• What is a unicorn? Unicorn is a term used in the venture capital industry to describe a privately held startup company with a value of over $1 billion.

• What triggered the unicorn rush during 2021?

While work from home during the pandemic fueled the growth of digital businesses in India, the incident also resulted in a long unicorn list. Mainly three factors, a thriving digital payments ecosystem, large smartphone user base and digital-first business models, have come together to attract investors. Tech companies, which have become household brands, are contributing to the unicorn boom in India, as smartphone penetration and digitization of commerce in every aspect of life has increased manifold during the pandemic. Besides fintech, e-commerce grocery, SaaS and marketplace players are contributing the most to the unicorn universe.

Unicorns of India

As of 9th February 2022, India is home to 88 unicorns with a total valuation of $ 295.99 Bn. The year 2021, 2020, and 2019 saw the birth of the maximum number of Indian unicorns with 44, 10, and 9 unicorns coming each year, respectively. COVID-19 has caused a great amount of socioeconomic suffering globally, but it is during this time when the resilient Indian Entrepreneurs have worked effortlessly to not only contribute to the economy but to also contribute toward COVID-19 relief efforts. In 2020, we witnessed the birth of more than 10 unicorns. ‘Its raining unicorn’ has been the motto of the year 2021 with 44 unicorns pumped in the ecosystem and many soonicorns waiting in line.

Geographically, the center of India’s high-tech industry, Bengaluru is India’s unicorn capital with the largest number of unicorns headquarters followed by Delhi (NCR) and Mumbai. While we see unicorns active in Tier I cities, this ecosystem is not restricted and is proliferating across the country till the last district. Traditional sectors such as Fin-tech, E-commerce, Supply Chain & Logistics, Internet Software & Services do dominate the arena but a strong wave of unconventional sectors such as Content, Gaming, Hospitality, Data management & analytics, etc are making their place on the list.

While every startup has its unique journey to becoming a unicorn, the minimum and maximum time taken by a startup to become a unicorn are 6 months and 37 years, respectively. Mensa Brands took only 6 months to become a unicorn in 2021, making it one of fastest unicorns in Asia.