Deep Tech, Deep Impact: India’s Next Frontier

The future of technology isn’t just about faster apps or smarter phones anymore. It’s about AI designing new drugs, rockets that can be reused like taxis, chips that power everything from cars to quantum computers, and robots that learn on their own. This is the world of deep tech where breakthroughs in science and engineering meet bold entrepreneurship. And India, with its third-largest startup ecosystem, is eyeing a front-row seat.

That ambition just got a massive boost. On July 1, 2025, the Union Cabinet approved a Rs 1 lakh crore Research, Development and Innovation (RDI) scheme to supercharge sunrise sectors like AI, quantum technologies, semiconductors, defence and space. Chaired by Prime Minister Narendra Modi, the plan is about fixing a critical gap and signalling to entrepreneurs and investors alike that India wants to lead, not follow, in the race for deep tech dominance.

At the heart of this story lies AI. Far from being just another tool, AI has become the accelerator of accelerators, the invisible force speeding up discovery, cutting costs, and flattening knowledge barriers. HSBC noted in a report that foundational infrastructure, from advanced chip architectures to enabling hardware, has matured enough to let companies “build faster and de-risk earlier.” Translation? Taking a wild idea from lab to market has never been this frictionless. “Artificial intelligence is essentially turbo-charging the innovation engine in deep-tech by accelerating simulations and prototyping. AI-driven modeling slashes weeks or months off complex experiments in materials, aerospace, and biotech, allowing teams to iterate rapidly,” said Ravi Kaklasaria, Co-Founder & CEO at edForce.

This catalytic role of AI explains why India’s deep tech ecosystem is buzzing. The country already counts more than 3,600 startups in the sector, with a goal of hitting 10,000 by 2030. In 2024 alone, investments jumped 78% year-on-year, touching $1.6 billion, according to Nasscom and Zinnov. The top 10 funding rounds drew $600 million and almost all of these were AI-led ventures tackling everything from biotech breakthroughs to semiconductor design. Yuvraj Bhardwaj, CEO and Co-Founder of Petonic AI, said, “AI has become a powerful catalyst for deeptech innovation by accelerating R&D cycles, reducing the cost of experimentation, and opening up new frontiers in science and engineering. For instance: In biotech and drug discovery, AI models can simulate molecular interactions, drastically cutting down the time and cost of preclinical research. In advanced materials, generative AI is helping scientists design novel compounds with specific physical properties, guided by data rather than trial-and-error. In semiconductor design, AI tools are improving chip layout efficiency and defect prediction. In space and robotics, AI enhances autonomous decision-making, enabling smarter systems with less human intervention. For early-stage startups, this means they can validate hypotheses faster, iterate prototypes quicker, and reach proof-of-concept milestones that would otherwise take years. AI flattens the knowledge curve making complex, computation-heavy fields more accessible and experiment-driven.”

This “flattening of the knowledge curve” is what could tilt the scales for India. Deep tech is notorious for requiring patient capital, years of experimentation, and close collaboration between academia and industry. Yet with AI collapsing timelines, even young startups can now play in arenas once dominated by global giants. Already, Indian ventures are proving this, from AI-first life sciences firms that cut drug discovery times, to semiconductor innovators rethinking chip layouts, to space-tech startups experimenting with autonomy for reusable rockets.

Still, money and momentum alone aren’t enough. If India truly wants to own the deep tech future, it needs a nurturing ecosystem, patient investors, strong research-to-market pipelines, specialised talent, and global partnerships. The Rs 1 lakh crore RDI scheme is a big leap, but the coming decade will determine whether the country merely participates in the global deep tech wave or actually helps shape it.