While the Indian startup ecosystem has grown in leaps and bounds in the last 5 years, Amitabh Kant, CEO NITI Aayog, Govt. of India, believes that there still exist many challenges that need to be addressed. Last week, I had the chance to attend the insightful session “Australia — India Innovation Opportunities Connect” organised by NEWLAND Global Group and inQ Innovation at Sydney startup hub.
Here are some highlights of the talk, mostly related to vibrant Indian startup ecosystem, with some notes on the unicorns emerging from India and how Indian Government is driving innovation.
- In 2016, Prime minister Mr. Modi has launched Startup India movement.
- Fund of funds of 10,000 crores are available for venture funds to assist startups. India has about 20,000 startups.
- One of the key things we do to drive innovation is through the program called the Atal Tinkering Labs, named after earlier Prime Minister, Atal Bihari Vajpayee, and have opened up close to about 150 innovation centers.
- If Indians startups can find solutions to the problems of India, actually are not finding a solution for the 1.3 billion people of India but for the 7.5 billion people of the world who will move from poverty to middle class in the next decade and a half and therefore the market for startups is not the 1.3 billion people of India but the 7.5 billion people of the world
- Population in India is getting younger and younger. Average age is 29. India is keep getting younger till 2042.
- In the last three years, we’ve seen 23 unicorns emerged out of India.
- In last fiver years, lot of work has been done to make India extremely easy and very simple. India has jumped about 65 positions in the World Bank in ease of doing business.
- No tax policy regime for startups for three years out of seven years.
- Fast tracking in the patent regime, we give them 85% exemption for startups, fast track their patents and the trademark registration.
- Just to name a few Indian successful startups, FlipKart, MitraBioTech, CultureAlley, OYO, OLA, BYJU, Embibe, TriCog, SatSure, NetraDyne
- India is only country in the world with a billion biomet, with a billion mobile and with a billion bank account.
- India has become data rich, before it has become rich.
- Australia - India collaboration to continue through Atal innovation vision to Startup India hub
For those who are interested, below is the full transcript of inspiring and informative talk by Mr. Amitabh Kant, CEO NITI Aayog, Govt. of India
First of all, I didn’t know that there was such a dynamic startup. And I didn’t know that there was so many young people operating out of here, fascinating things happening here. I think it’s a great occasion to connect India and Australia together.
India — Ladies and Gentlemen is growing at about 7.5% per annum. It is an oasis of growth in the midst of a barren economic landscape across the world. But the challenge for India is really to grow at higher rates of 9 to 10%, year after year, year after year for three decades, to be able to lift a very, very young population above the poverty line.
The biggest transition that is taking place across the world, the population in India is getting younger and younger. Average age is 29. We keep getting younger till 2042. Population across the world keep getting older and older. So you have 8000 Americans retiring 8500 Jones retiring a day. And therefore, India needs to create wealth when it has light dependency burdens.
Over the years, we’ve made India very complex, very complicated and difficult place to do business. The last five years, we’ve tried to make India extremely easy and simple. We dismantle the number of rules regulation procedure and laws that 1300 laws have been done away with. We’ve jumped up about 65 positions in the World Bank in ease of doing business. We also created a competition among the states, Telangana, both Andhra and Gujarat. And therefore those huge competition for the good thing was that the mineral rich states of Jharkhand and Chhattisgarh which are very rich in minerals, they came fourth and fifth. And they brought in a huge transformation. My belief is if you start ranking, and if you start naming and shaming, if you start making good governance and good politics, you will see a radical difference in India. That is what is happening in India.
One of the key things we’ve tried to do is to really put young entrepreneurs at the heart of India’s growth story.
In 2016, I’ve got Prime Minister, Mr. Modi to launch the startup India movement. And this was a tremendous occasion, because at that point of time, many of our startups used to either go to Singapore to Silicon Valley, they used to relocate. But today we have about 20,000 startups in India.
They’re doing some really brilliant work. We have a fund of funds of 10,000 crores where we support venture funds to assist startups. We have no tax policy regime for startups. For three years out of seven years. We have a fast tracking in the patent regime, we give them 85% exemption for startups, we fast track their patents and the trademark registration. We procure their goods through the global, what we call the jet platform where all the government procurement takes place. So for the young startups, government procures goods, even if they don’t have experience, as long as they match quality, and we’ve created a startup hub, where we provide all assistance online classes, and we hand hold them. And we made things extremely easy and simple. So there are no procedural issues for startups. We did everything possible. And in the last three years, we’ve seen 23 unicorns emerged out of India. In a very short period, we’ve done some tremendous work in the world of startups.
And what we have seen today is not merely that we’ve been able to create a young startup like Flipkart, which was bought over for 20 billion US dollars by Walmart. But the fact that you see startups across education, across health, across nutrition, across transportation, And it’s not merely that you have startups like OYO, which in four years time, has created more inventory of rooms, that what Taj Oberoi, or ITC could do in the last hundred years. And now OYO is venturing into China, into Saudi Arabia and the UK or create OLA which has been Uber in the Indian market is now venturing into newer markets abroad and UK and many other places. It’s not that we have created a startup like BYJU, where Mark Zuckerberg has invested his personal money, now which is today become a 5 billion startup in a very short period. But the fact that Indian startups are actually doing unique things.
The Silicon Valley is very innovative, but the Silicon Valley has no challenges, it has no challenges. All the challenges are in India.
And you innovate to find solutions to the challenges. And therefore, if Indians startups can find solutions to the problems of India, we are not finding a solution for the 1.3 billion people of India, or for the 7.5 billion people of the world who will move from poverty to middle class in the next decade and a half and therefore the market for startups is not the 1.3 billion people of India but the 7.5 billion people of the world. Therefore, what we’ve seen in the last four years is the reverse movement of startups moving from Silicon Valley and Singapore into India, because of the ecosystem we have created. MitraBioTech, which does personalized cancer care, actually relocated from Silicon Valley to Bangalore has done some unique work around personalized cancer care. And some unique work happening in India. Look at a young girl, who started a startup called CultureAlley to teach Mandarin and Japanese and soon realized that actually, the demand was for teaching English in India and in one year taught 9 million Indians “how to speak in english”, no school or college has been able to do this or look at another startup which is called Embibe and which is run by the girl called Aditi and which tracks every single student.
In India, we’ve been able to provide access of education but the quality of education, learning outcomes in a lot of improvement. So Aditi tracks every student, longitudinally and latitudinally like we track Uber cars, and she provides extra dose of education to those who are left behind. And there are efforts of machine learning, artificial intelligence in education has led to her giving additional classes to students who lack behind the Maths, physics chemistry, and has radically improved learning outcomes in the state of Rajasthan.
Look at a startup like SatSure which provides data information regarding weather and soil conditions to our farmers on a real time basis. And it has led to farmers providing the right amount of water, right amount of seed the right amount of fertilizer based on this flow of information and this has led to a huge enhancement of agricultural productivity in terms of making a massive difference on ground.
Look at a startup like TriCog which uses its own ECG machines, and pushes out your cardio graphs into doctors and third party assessment is able to get data and is able to analyze and put it back to the consumer to the patients all within a period of three minutes. Third Party assessment labs, doctors assessments, all that analysis and all that flowing in back to the patient within a period of three minutes The world has never seen this or look at NetraDyne, which uses artificial intelligence in the world of transportation, to train drivers etc on behavior. So, what the startups in India are doing,
Look at Ather, Ather is a young startup, which has produced the smart scooter in Bangalore and has the potential to be the Tesla of the scooter world and is driving electrification of two-wheelers. And in India 72% of vehicles are two-wheelers. And therefore, what these people are doing really is disrupting in a manner which India has never seen before.
Neeta Ganesh, Shanti Mohan or Aditi all of them are driving changes in a manner, which Indian women entrepreneurship has never done? Therefore, Anna runs a program called Women entrepreneurship program, where she trains women online, and does a mixing and matching of young entrepreneurs with corporates so that you can create some marketplace for entrepreneurship.
And therefore, what we’ve seen is like huge disruption, and much of this is happening is India is only country in the world with a billion Biomet. We are the only country in the world with a billion mobile, we are the only country in the world with a billion bank account.
Many years back I used to work at the fishery sector of Kerala and my job was to finance returns to traditional fishermen and fishermen then you forget just 25% of the market price. My job was to take it to 85 90% and when we try to we give the new technology fiberglass crowds we give them fishing nets out what do you called the disco nets, and we gave them outboard motor, so they could go much further into the sea. We introduce beach level auctions but opening their bank accounts was a nightmare. It used to take us seven months eight months know your customer
But Know your customer was an absolutely a difficult task. But today in India using biometric you can use open your bank account in 55 seconds less than a minute. So what do you take nine to 10 months you cannot go less than a minute using technology. This has been the technological leap province of India, you can open a bank account you can get a new mobile connection you can get a new SIM card all this happening within less than a minute.
And therefore, what India has done is really leap frogging in terms of mobile telephony. Everyone in India uses mobile phone, uses data, uses biometrics and therefore the mobile data consumption in India today is more than the mobile data consumption of US and China put together.
And we’ve we’ve gone digital in a big way.
And every single program with the government the goods and services tax, one tax across India is like one tax across Europe is all digital, this paperless and cashless, the new Ayushman Bharat scheme, which is more than which is one health scheme for 500 million Indians 500 million Indians, means the population of USA, Europe and Mexico put together is all digital.
And if you look at the direct tax in India, 99% of the people pay direct tax online, and 96% of them get settled within a period of three months. And public finance management system of government of India, all of us are only digital, we can release money only digitally. So whether it’s direct tax, whether it’s goods and services, Where is Ayushman Bharat, whether it’s public finance management system is all digital, it’s all digital.
India has become data rich, before it has become rich and therefore, there is huge amount of data, this data is the new oil as everybody says, and to my mind, this is leading to over 1000 FinTech companies in India, doing a huge amount of work.
All of them are doing innovative work for financial inclusion, and they are using machine learning. They’re using artificial intelligence. And they are creating products to provide lending to people below poverty line lifting them above on the basis of just data. And therefore what India seen today is that data, machine learning artificial intelligence is driving many of these innovations.
We have about 400 companies\ startups working on artificial intelligence.
And so unlike America, where data is owned by Google and Facebook, and unlike China, where it’s owned by Ali Baba, and Tencent and Baidu, In India, we’ve created public entities, we’ve created AAdhaar which was biometrics, we’ve created unified payment interface, which owns digital payments, we’ve created the GST, goods and services taxes like public highways, we have created expressways, which are publicly owned, but we’ve allowed private sector to innovate. So Google pay Samsung Pay, all of them innovate on top of that. And therefore, the data is publicly owned. It’s not owned by Google or Facebook or Baidu, Alibaba.
It’s publicly owned but private sector comes and innovate. So that’s the difference between India and America and India and China. Ours is a transparent process of putting data and public domain, and therefore startups have access to this data, academicians. And many researchers have access to this data to innovate. And I think that’s the distinguishing feature of India, that India has gone digital, India has gone data and India has become data rich, and India has allowed a lot of this data to use for innovation and therefore, what we will continue to see in India is a lot of innovation and a lot of disruption in the days to come.
We in government, act as facilitators, act as catalyst. But we do many things, I give you an example of women entrepreneurship program. One of the key things we do to drive innovation is to start a new program called the Atal Tinkering Labs named after earlier Prime Minister, Atal Bihari Vajpayee.
What we’ve inherited from the British years was the Anglo-Saxon system of education that you study books, you pass one class, you study books, you get into the next class, and you keep studying and mugging of books and you keep getting into the next class. We’ve disrupted that now. We’ve opened about 3500 tinkering labs, where we provide 3d printers, robots, internet of things from class six onwards, and class six onwards, we find that young students are far more innovative, they are far bigger disruptionists. And we’ve offered up this tinkering lab across schools all over.
And we’ve opened these tinkering labs in some slum school, some public schools, and some IIT’s led schools. We just had a competition of these tinkering labs. And what we found was that the students from the slum school beat the students from the public school, and they beat the students from the IIT school. Because unlike the IIT school, and the public school, they were not doing algorithms, they were finding solutions to their problems. And they would find the best solutions for converting waste into energy, and for finding solutions for water management.
And therefore, my belief is that as we find solutions for India, and the only way to find solutions is to unleash disruption and push the startups into this. If they find the solutions, will be finding solutions for the world. The Silicon Valley has always innovated, it has innovated for driverless cars, it has innovated for defense weapons. But that is not what the world needs. The world needs solutions for water, the world needs solution for agriculture, productivity, the world needs solution for waste, the world needs solution for transportation. And all these solutions are what we’re trying to strive for.
The world needs solution for financial inclusion. And that is what the startup movement in India is doing, and we are pushing this through tinkering lab through incubation centers. We’ve opened up close to about 150 innovation centers. And therefore what India seeing is a unique innovative spirit. We’ve combined innovation and entrepreneurship and skill to do a lot of innovation for the world. So Microsoft Bing was innovated in India, John Deere 60 model tractor was innovated in India, GE’s low cost ECG machine the ECG machine used to cost $35,000 they have innovated in India for $3,500. They do ECG what they used to do for $35 one ECG now they do for just $1, from $35 to $1 one ECG and that is because of innovation in India, Samsung’s all 3g 4g 5g was innovated in India SAPs entire software for fashion world was innovated from India, Shell’s new conversion of waste into diesel and petrol for BS4 innovated in India. And Honeywell’s latest turbo charger was innovated in India.
So we’ve innovated for the rest of the world at price points was the one I’d never seen before through frugal engineering through innovation and entrepreneurship. And that is why India is the center for compact car manufacture and India is the Center for the pharmacy of the world. If it wasn’t for India, the world would never have got pharmacy medicines at the right price point. And therefore a journey of innovation, journey of startups and a journey of disruption and a journey for financial inclusion continues. And we in India will use the startups to create the best ecosystem in the world, to find solutions for the world and continue to disrupt and find very, very innovative things. We will find the markets for them and will continue to support and to fund of funds will continue to assist and catalyze. And my view is that this is a great opportunity for India and Australia,
Australia- I love the startups, the startup hub here. And I love the startup hubs, which we have created many parts of this and I would like this collaboration to continue through Atal innovation vision to Startup India hub. I would like many startups of here to find solutions to our problems and I’d like many Indian startups to come and work here with Australia, many of you will create this innovation connect, this innovation bridge between India and Australia so that we can find solutions for the rest of the world between India and Australia, like we do between India and Israel. And I think that is the way forward. And we will be very delighted to work with all of you who are doing innovative work at the startup hub. I’m delighted to be here. I congratulate you and I wish you all the best and great future. Thank you very much.
With a population of more than 1.3 billion, India is the world's largest democracy and sixth largest economy in the world.