Dr. Arvind Kumar*
As inevitable climate hazards worsen, the rate of global warming is outpacing attempts to protect billions of people. Get ready for a growing wave of emerging technologies developed and scaled with the ultimate goal of solving a social or environmental challenge. Deep tech lays one of the most promising pathways towards mitigating climate change. And this creates an encouraging synergy: startups from the climate tech landscape that are deploying deep tech technologies to enable a zero carbon economy. Complex solutions are required for complex issues. Issues such as technological transformation, green development, spotlighting women-led development, accelerating implementation of SDGs, and facilitating inclusive and resilient growth have been flagged by India as part of its agenda for the G20 presidency. Deep technology (DT), which includes artificial intelligence, cutting-edge materials, biotechnology, blockchain, robotics and drones, photonics and electronics, and quantum computing, has the potential to address a number of global issues, from cancer to poverty to sustainable development.
What are the unique challenges faced by them?
Although DT is expanding, there are still a number of challenges. According to the Inc4Plus research, DT only makes up 6.9% of all active companies in India and doesn’t rank in the top 10 industries for raising capital. However, the report showed that not a single DT startup had achieved unicorn status. Due to the fact that DT startups based on AI and machine learning receives the majority of investment, the challenge for green DT becomes increasingly serious. This is partially caused by the lengthy development cycle of the emerging technology, which could yet not live up to expectations. Scientists may find it challenging to communicate their findings to investors who are primarily finance experts due to the fact that Indian boards are more money driven than science and technology. Another barrier to firms working with new DT startups is their focus on seeing sustainability and the environment just through the lens of ESG compliance.
Uncovering Deep tech
We can manufacture well in India. How many molecules have we produced, though? One Saroglitazar from Cipla, for a medication to treat Type 2 diabetes, has been available for the past ten years. China, in contrast, submitted at least 20 medicine patent applications in 2021 alone. What then distinguishes them? Consider the pharmaceutical sector- Deep science is a new molecule. Consider vehicles- Deep tech is the process of developing novel materials to produce new varieties of brake linings. When it comes to deep tech and deep science, mindset—both institutional and individual—is what pushes one country ahead of another. How much importance do we accord to research? How accustomed are we to losing? How much of a deferred outcomes culture do we allow? India made a shift in the information technology (IT) ecosystem, moving from providing IT services to providing cloud-based and SaaS solutions (Software as a Service). But why didn’t India begin developing the underlying technologies that support SaaS or the cloud? Why did that need to be developed elsewhere in the world? What is required to establish such a base in India?
How transformatively deep tech has bridged the resource gap
Representing a slither of start-ups but making an outsize impact, most 97% of deep-tech ventures globally contribute to at least one of the United Nations Sustainable Development Goals which act as a blueprint to achieve a better future for all. An excellent contemporary example is what transpired during Covid; everyone anticipated the necessity for a vaccine and a vaccine delivery mechanism. Then they appeared with years of effort have been put into setting the stage for such an mRNA vaccination, and the results have paid off greatly in terms of both time and money. The mRNA-based vaccines were created and put on the market quickly. This was largely because long-term investments allowed for comparatively inexpensive modifications and adaptations of current technologies. With the development of EV batteries and clean, zero-emission hydrogen-based transportation options, DT has the potential to revolutionise the transportation sector, which accounts for approximately a quarter of global carbon emissions. Another industry that has to be decarbonized through the use of biotechnology is agriculture. DT is under pressure to improve the shockingly poor energy efficiency in the power and white goods sectors. Consumers can enjoy convenience from DT’s motion-sensing based smart solutions, which also improve energy efficiency in daily living. Due to DT innovations’ ongoing technological advancements over the past ten years, the cost of producing renewable energy has drastically decreased, and this trend will only continue as more nations around the world integrate renewable energy sources into their energy mix. Moreover, DT is being used to reduce water stress, create more robust early warning systems, boost agriculture yields, produce biodegradable packaging and textiles, and create concrete and building materials that are carbon negative.
Where does India’s idea in DT stand?
In India, the DT industry has grown rapidly during the past few years. For DT startups, NASSCOM India projects a 40% Compounded Annual Growth Rate (CAGR) between 2020 and 2024. According to Inc4Plus’ 2021 Indian Tech Startup Funding Report, there are 2,769 active DT firms in India, and in that year, DT raised a total of $451 million in funding. Also, the analysis finds that, in terms of deal count, the DT sector experienced one of the fastest rates of growth between 2018 and 2021, with a CAGR of 35%.
When combined with AI-driven algorithms, India’s enormous population is already proven to be beneficial to research endeavours. Using information acquired from biobanks, trials are being conducted in the field of pharmaceutical research to test new medications. These biobanks contain information acquired from all around the nation that is fed into AI models rather than being seen by humans. While this is happening, some brilliant minds are working on urgent issues, such as exploring space, rethinking healthcare, and figuring out how to use encryption to make the internet a safer place.
With programmes like Startup India, Clean Energy Research Initiative, Atal Innovation Mission, and Sustainable Finance Scheme, the government is facilitating economic growth (SIDBI). Launched in 2021 in conjunction with the UK, the Climate Finance Leadership Initiative (CFLI) India programme aims to advance green finance through commercial, bilateral, and international alliances. AIM-PRIME, a strategic project by NITI Aayog, has also been introduced. It is meant to educate and direct DT researchers into market application. Neither is the private sector falling behind. To support its DT mentoring programme, NASSCOM has developed Deep Tech Club. One cross-industry coalition called “India Deep Tech” was formed with the aim of advancing and funding DT in India.
Conclusion
The nature of the businesses that come out of India would drastically shift with such issues and concepts at play. If managed properly, it’s even feasible that India may become a model for the Global South by harnessing the potential during its G20 presidency, especially in the fields of healthcare, fintech and climate-smart solutions for populations in distant places. The West may even come to believe that they underestimated India’s prowess. Notwithstanding the difficulties, the industry will expand since both consumers and the government are adopting a more sustainable mindset. The creation of green-only venture funds like Infuse Ventures and the recent announcement by CIIE to establish a separate climate tech fund with a corpus of $100 million will give young technopreneurs the motivation they need to delve deeply into green and clean technology now that incorporating sustainability into business practices and products is no longer an option but a necessity. The growth of deep tech startups is going to be essential to India’s trillion-dollar economy roadmap. As a nation, we need to significantly amp our focus and commitment to growing this sector. It is what will make or break our ability to drive world-class from India.
*President, India Water Foundation
