Start-up Ecosystem In India

Startup ecosystem can help India become powerhouse of global economy


From UPSC perspective, the following things are important :

Prelims level: Unicorn club

Mains level: Paper 3- How startup ecosystem can help transform India


With 62 per cent of the population in the working-age group and 54 per cent below the age of 25, we have the advantage of leveraging the skill and ability of our youth to drive the nation forward through productive output and innovation.

Significance of startup ecosystem in the country

  • In 2021 alone, Indian startups have so far raised upward of $20 billion in funding.
  • Today, India is home to more than 40,000 startups and is building a robust tech and internet infrastructure.
  • The last decade-and-a-half has witnessed a significant change in the landscape — from the founding of new startups, to global investor interest, to the advances made in infrastructure and policies.
  • Global investors too are realising the potential upside in India’s huge, under-penetrated market as the country steadily makes a place for itself as a leading R&D hub for many Silicon Valley companies.
  • Amid the Covid-19 pandemic, Indian startups have rapidly innovated to provide indigenous, tech-enabled solutions to combat challenges from testing kits and ventilators to remote monitoring, and preventive technologies, as well as innovations in supply chain management, logistics, and education.

Factors driving startup economy in India

  • The steady rise of Indian IT companies in the 2000s, a large talent pool of a skilled workforce, increased expendable income, and rising capital inflows have collectively contributed in large part.
  • Young generation: Moreover, the ability of the young generation to take risks, move fast, and disrupt things without fear, has become our biggest asset today.
  • Increasing internet use: In the next five years and likely to have an estimated 850 million internet users by 2030, the country stands at the cusp of unprecedented economic growth.

How it helps economy

  • The proliferation of this startup economy has brought with it new business opportunities, innovation, tech-centric approaches and job creation across sectors.
  • A mature startup ecosystem, with seasoned entrepreneurs and technology-led solutions, paves the way for innovation and expanding its global footprint.
  • While value creation lies at the centre of entrepreneurship, Indian startups are also taking big strides in building synergies and partnerships with global entities, further demonstrating the evolution of the startup ecosystem and its appetite for innovation, collaboration and disruption.
  •  In fact, one of the paradigm shifts brought about through technology during the pandemic has been systemic shift to online education and remote learning at scale.
  • Solutions built by Indian startups saw widespread adoption not just domestically but also on a global scale, firmly establishing the country as a cornerstone of tech and innovation in the world.


  • Educations and reskilling: In order to transition beyond the current capabilities and achieve the demographic dividend, education, and reskilling, and upskilling of our workforce is crucial.
  • Policy environment: Apart from the domestic policy environment, the global environment and technological advances are also changing, and it is imperative that India is prepared for this revolution.
  • Foster entrepreneurship: Apart from policy-level decisions that promote entrepreneurship, the onus is also on India’s corporate sector to foster entrepreneurialism, and create synergies to build impactful technology solutions, sustainable and resource-efficient growth.
  • Inclusion and sustainability: As country stands at the cusp of unprecedented economic growth, speed, inclusion, and sustainability are key elements in this mission.
  • Tap the potential of rural and semi-urban India: The collective future efforts of the public and private sectors to improve physical and digital connectivity will also help unlock the untapped potential of rural and semi-urban India to truly lead Industry 4.0 and beyond.
  • Focus on goals of national importance: In view of achieving this transformation at scale, the Indian startup ecosystem must focus on developing solutions that allow businesses in key sectors to meet goals of national importance.


Coupled with the nation’s focus on strengthening digital infrastructure in healthcare and education, and boosting employment in manufacturing, there is little doubt that India@100 will be a powerhouse of the global economy.

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