Commerce and industry minister, Piyush Goyal’s sharp comments about India’s startup ecosystem at the Startup Mahakumbh on Thursday have drawn strong reactions from the country’s entrepreneurial community, with many taking to social media to express their disappointment and push back against what they viewed as an unfair comparison to China.
Goyal had urged Indian startups to pivot away from hyperfast grocery delivery and fancy ice creams and instead focus on deep tech sectors like semiconductors, robotics, AI, and EVs, areas in which he said Chinese startups are leading. He went further, criticising Indian food delivery startups for turning unemployed youth into “cheap labour” and questioned, “Are we happy about being delivery girls and boys?”
The remarks struck a nerve across the startup ecosystem, triggering a flurry of reactions from founders, investors, and industry watchers. Many viewed the comments as a dismissal of the hard-won progress made by consumer Internet startups that have emerged in recent years, often in challenging conditions.
Zepto CEO Aadit Palicha was among the first to respond, writing on LinkedIn that while it’s easy to criticise startups in food delivery and commerce, such businesses have created jobs, paid significant taxes, and attracted substantial foreign capital. “If that isn’t a miracle in Indian innovation, I honestly don’t know what is,” he stated. Zepto, which started less than four years ago, now supports 150,000 livelihoods, contributes over Rs 1,000 crore annually in taxes, and has attracted more than $1 billion in foreign direct investment, he said.
Echoing Palicha’s sentiment, former BharatPe MD Ashneer Grover pointed out that China too began with consumer-facing services before transitioning to deep tech. He added that rather than chastising startups, political leaders should focus on maintaining a 10%+ GDP growth rate for two decades. “Startups are the job creators today,” Grover wrote on X.
Similarly, Arjun Vaidya, co-founder at V3 Ventures, argued that India is also building technology that is meaningfully improving the quality of life.
Mohandas Pai, former Infosys CFO and a leading investor, also came down hard on the minister’s remarks. He highlighted the systemic issues preventing Indian startups from going deep tech, notably the lack of capital. “Indian startups got $160 billion from 2014 to 2024, compared to $845 billion in China and $2.3 trillion in the US,” he said, adding that domestic institutional capital remains under-leveraged and regulatory frameworks still deter long-term investment.
Others, like Anupam Mittal of Shaadi.com, acknowledged there is room for improvement in the ecosystem but called for a more constructive and collaborative approach. “We need encouragement and support, not just criticism,” Mittal said.
Ganesh Sonawane, CEO of Frido, a direct-to-consumer brand, emphasised that for Indian startups to scale and innovate, the government must focus on easing business norms. “We don’t need capital or subsidies right now. What we need is less regulation, faster approvals, and less red tape,” he said.
Still, some voices in the ecosystem agreed with Goyal, at least in part. Zoho co-founder Sridhar Vembu backed the minister’s emphasis on deep tech, seeing it as a challenge rather than a reprimand. “The government should not invent smarter robots. That’s for entrepreneurs to solve,” he wrote, underscoring the need for private sector initiative. “I see minister Piyush-ji Goyal’s call as a challenge to our engineers and technologists and not as pointing fingers,” Vembu added.
Paytm founder Vijay Shekhar Sharma also acknowledged that India needs to build foundational technologies but noted that doing so requires greater access to domestic capital. He said that the country must learn from the past, when a lack of local financial support slowed down tech ambitions.
Amit Ranjan, co-founder of Slideshare, partially agreed with Goyal, noting that many Indian startups chase low-hanging fruit like transactional businesses driven by labour arbitrage rather than groundbreaking innovation. Investors like Rajan Anandan of Peak XV Partners saw potential in deep tech as a “final frontier” for India but maintained that consumer tech has laid a foundation for broader innovation.
While a few offered nuanced agreement with Goyal’s vision, the overwhelming sentiment within the startup community was one of frustration, not necessarily with the call for deep tech, but with the tone and context of the criticism. Many argued that India’s startup ecosystem is still in its formative years and building the foundations for broader innovation.
(With inputs from Raghav Aggarwal & Anees Hussain in Delhi)