Startups to play key role in India becoming third largest economy: Nageswaran

Speaking on the concluding day of the Huddle Global 2023 organised by the Kerala Startup Mission (KSUM), Nageswaran said the tier-2 and 3 cities, including Thiruvananthapuram, have become game-changers in helping startups flourish in the country due to improvements in infrastructure and supportive policies of the respective government, a KSUM release said.

The CEA said India was the fifth largest economy on course to become the third largest in a few years.

“As all of you know very well, we are the fifth largest economy in the world, which is on course to become the third largest in a few years. In fact, I would say ‘7-in-7’ is the buzz slogan, i.e., $7 trillion economy in seven years. It is possible by 2030 if India maintains its present growth trajectory, and in that journey, startup entrepreneurs are going to play an important role,” PTI quoted Nageswaran as having said in the release. 

“The active participation of startups in India in developing business models on the foundation of expanding physical and digital infrastructure will continue to generate efficiency, revenue and economic returns for the country. The culture of entrepreneurship and innovation is one ‘pandemic’ that India would like to experience continuously. It must spread,” he added. 

“The last decade has seen an exceptional transformation in the startup landscape in India, which has emerged as the third largest ecosystem globally, with over 1.12 lakh startups presently recognised by the Department for Promotion of Industry and Internal Trade (DPIIT) across 763 districts.

Among them, more than 110 are unicorns with a total valuation of around USD 350 billion,” he said.

The chief economic advisor further said India ranks second in innovation quality.

Nageswaran said innovation in the country was not just limited to certain sectors as startups were solving problems in 56 industrial sectors, with 13% of them from IT services, 9% from health and life sciences, 7% from education, 5% from agriculture and 5% from food and beverages.

He further said it was significant that 49% of the startups were from tier-2 and 3 cities which have turned out to be game-changers as the business advantages in these locations enable entrepreneurs to operate at lower costs as compared to tier-1 cities.

“Apart from improved infrastructure and the government’s pro-active policies, the availability of a technically skilled talent pool is a huge advantage for startups to set up and flourish in tier-2 and tier-3 cities,” he said.

He said that historically there was a perception that small towns were difficult places to conduct business.

“…but with improved internet penetration, vastly better physical infrastructure, road, rail and air connectivity and supportive government policies, this is no longer true,” the chief economic advisor added.

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Updated: 19 Nov 2023, 05:22 PM IST