India has increased the revenue cap for startups eligible for deep tech benefits, acknowledging the longer timelines and higher costs of frontier innovation.
India is adjusting its startup policy to better fit the realities of deep technology.
The government has extended benefits for deep tech startups by raising the revenue threshold that determines eligibility for incentives and support programs. The change reflects a growing recognition that companies working on advanced technologies often generate revenue later—and at different scales—than consumer internet startups.
It is a technical tweak with strategic implications.
Why deep tech needs different rules
Deep tech startups operate in domains such as semiconductors, advanced materials, biotechnology, robotics, and energy systems. These sectors demand heavy upfront investment, long research cycles, and regulatory approval before commercial payoff.
Under earlier frameworks, some companies lost eligibility for benefits just as they began to show traction—despite still being years away from meaningful profitability.
By raising the revenue cap, India aims to keep promising firms within the support net for longer.
Policy catches up with ambition
India has made no secret of its desire to move beyond services-led innovation toward technology ownership and intellectual property creation.
But ambition alone does not create ecosystems. Policy must reflect how frontier companies actually grow.
The updated threshold suggests policymakers are responding to feedback from founders and investors who argued that one-size-fits-all startup definitions were holding deep tech back.
Practical impact for startups
Extended eligibility can translate into continued tax benefits, access to grants, easier compliance, and preferential treatment in government-backed programs.
For founders, that support can mean the difference between slowing down and pushing through a difficult development phase.
For investors, it reduces policy risk—making deep tech a more predictable category in an already challenging funding environment.
Part of a longer-term shift
The move aligns with other efforts to strengthen India’s innovation pipeline, including support for research commercialization, semiconductor initiatives, and public–private partnerships.
None of these changes will produce overnight success stories. Deep tech ecosystems mature slowly.
But by adjusting the rules to match reality, India is signaling patience—and an understanding that frontier innovation requires it.
As global competition in advanced technology intensifies, that patience may prove to be one of India’s most important policy tools
