India must step up support to cleantech & climate tech startups

That startups can contribute immensely to India’s growth story has never been in doubt.

In a post on social media platform X on January 16, Union Commerce and Industry Minister Piyush Goyal h said: “Bharat’s Startup Story = Bharat’s Growth Story”. In March, a report brought out by industry body CII spelled out impact that startups can make in fast-tracking realisation of Viksit Bharat (developed India) goal by forecasting that ‘startup and venture economy’ could likely contribute $1 trillion to Indian economy and, also, d over 50 million jobs by 2030.

However, amidst all talk on India’s startups and how y can become potential game-changers, time may have come now to turn our gaze towards an issue that, inexplicably, has not been discussed as much as it should despite its strong linkage with multiple national objectives, including, most importantly, that of Sabka Vikas (development for all).

matter I am referring to pertains to stark absence, thus far, of any unicorns – yes, you re it right – in cleantech and climate tech domains in India’s multiple unicorn-spawning startup ecosystem. India has one of highest numbers of startups worldwide, with more than 100,000 recognised startups as of 2023 and unicorns spre across ed-tech, fintech segments, etc.  

Both cleantech and climate tech focus on areas like clean energy, built environment, supply chain, and transportation. ditionally, cleantech caters to clean water, recycling, and waste, and air quality and pollution domains. Besides those mentioned earlier, climate tech also focuses on carbon capture, afforestation, agtech, and geoengineering.

What makes absence of unicorns in cleantech and climate tech segments unfortunate is significant role having many well-funded local startups in se domains can play in helping India dress challenges posed to lives and livelihoods of its citizens by climate change and rise in extreme wear events.  

Having a sizeable number of home-grown innovative cleantech and climate tech startups having ability to scale rapidly can also contribute to India being able to achieve several targets associated with numerous sustainable Development Goals (SDGs) – especially Goal 3 (Good Health and Well-being), Goal 6 (Clean Water and Sanitation), Goal 7 (Affordable and Clean Energy), Goal 8 (Decent Work and Economic Growth), Goal 11 (Sustainable Cities and Communities), and Goal 13 (Climate Action).

That’s not all. emergence of more promising local startups in cleantech and climate tech arenas with potential to come up with India-specific offerings can reduce country’s dependence on vanced West for se critical technologies. Incidentally, transfer of climate technologies is an issue that keeps getting raised by Global South, including India, at every meeting of world leers on climate issue, especially at yearly UN Climate Change Conference more popularly known as COP summits.

According to World Bank, more than 80 percent of Indians “live in districts that are at risk of climate-induced disasters.” In context of India, World Bank has furr pointed out that “rising temperatures, changing rainfall patterns, declining groundwater levels, retreating glaciers, intense cyclones, and sea-level rise can precipitate major crises for livelihoods, food security, and economy.”

In its Global Risks Report 2024, World Economic Forum (WEF) h placed ‘extreme wear events’ in second position in list of ‘global risks ranked by severity’ in short term. Over long term, ‘extreme wear events’ were stated as biggest global risk.

Way forward

Over past dece, Narendra Modi-led governments at Centre have demonstrated that authorities would do everything it takes to improve quality of life of Indian people.

Given huge promise that startups in cleantech and climate tech arenas hold in terms of being able to play an effective role in dressing multiple national challenges, it may, thus, be fitting if Modi government 3.0 could come up with an action plan to provide greater support to se new-age businesses.

A wish list in this connection would include authorities devising a dedicated funding mechanism for cleantech and climate tech startups as part of government’s first 100-day agenda so that se startups, in turn, can contribute more effectively to ‘development for all’ cause. Such an arrangement being announced in full Union Budget for financial year 2024-25 to be presented in July would be icing on cake.

At end of day, startups in cleantech and climate tech segments fail to reach ir full potential due to reluctance of investor fraternity to provide large dose of patient capital that is required for making a business viable in cleantech and climate tech domains cannot be good news for country.

India’s cleantech and climate tech startups are far too important to be left at mercy of venture capital (VC) funds, private equity (PE) firms, etc. on lookout for safe bets and quick returns.      

(Sumali Moitra is a current affairs commentator.)