Piyush Goyal's Remarks on Consumer Internet Startups Trigger Fiery Response from Industry Industry leaders have said that it's inappropriate to belittle startups based on the nature of their business as the Indian economy is still on its maturity curve

Union Minister of Commerce and Industry Piyush Goyal's remarks at the ongoing Startup Mahakumbh questioning whether Indian startups should keep building food delivery and "ice cream" apps, have triggered strong responses from industry leaders.

Goyal had urged BIZ Experiencess to reassess their value propositions, suggesting that too many startups were focused on food delivery and instant logistics with little long-term economic impact. He said many startups end up turning unemployed youth into cheap labour rather than pushing boundaries in sectors like semiconductors, robotics, EVs, and battery technology – areas where, according to him, Chinese startups are advancing.

Industry leaders have said that it's inappropriate to belittle startups based on the nature of their business as the Indian economy is still on its maturity curve and there is technology, innovation, and value-add in every business.

Former Infosys board member TV Mohandas Pai urged the minister to focus on fixing the challenges holding back deep tech. From lack of capital to regulatory hurdles, Pai said the real problem isn't ambition, but the system meant to support it.

"Minister @PiyushGoyal, there are very many small deep tech startups in Chip design, IOT, Robotics, EV charging, BMS in India, growing rapidly but where is the capital?" Pai wrote in a post. He flagged the stark difference in startup funding over the last decade: "Indian startups got USD 160 billion from 2014/24, China USD 845 billion, US USD 2.3 trillion."

He said despite the government's efforts, "long term investors like endowments, insurance still do not invest." According to Pai, this is a result of policy failure.

In a follow-up post, Pai wrote, "Minister @PiyushGoyal should not belittle our startups but ask himself what has he done as our Minister to help deep tech startups grow in India? It is easy to point fingers at them."

Zepto Co-founder Aadit Palicha defended the role of consumer internet companies in driving innovation and employment.

"It is easy to criticise consumer internet startups in India, especially when you compare them to the deep technical excellence being built in US/China," Palicha said in a post on X.

"Using our example, the reality is this: there are almost 1.5 lakh real people who are earning a livelihood on Zepto today — a company that did not exist 3.5 years ago. ₹1,000+ crores of tax contribution to the government per year, over a billion dollars of FDI brought into the country, and hundreds of crores invested in organising India's backend supply chains (especially for fresh fruits and vegetables). If that isn't a miracle in Indian innovation, I honestly don't know what is," Palicha said.

Ayush Jain, Founder and CEO of healthtech startup Mindbowser complements Palicha's views and says that technology is only a means to solve real-world problems.

"As of January 2025, just 19.5 per cent of Indian startups are formally tech-focused, but what's more telling is that over 77 per cent are investing in technologies like AI, ML, IoT, and blockchain. It's a clear sign that startups increasingly recognize the need to solve real, complex problems with innovation at the core," said Jain.

"In sectors like healthcare, education, finance and others, tech is no longer a value add, it's the foundation for scale, impact, and global relevance. The government's commitment to supporting founders and strengthening domestic capital is a much-needed step in ensuring long-term resilience and reducing external dependency. At this point, tech isn't just a tool, it's India's most strategic lever for future growth," Jain added.

Paytm founder Vijay Shekhar Sharma also said that developed economies like the US and China are able to play the longer haul as they have the resources and maturity. "While counties like India have to play with the current opportunities in front of us...the money that comes from here will help us extend to the next opportunities. I am happy that India is taking startups seriously today with events like the Mahakumbh taking place."

Similarly, Ashneer Grover, former Co-founder and MD of BhartPe said that the only people in India who need a "reality check" are politicians.

"Everyone else is living in the absolute reality of India. China also had food delivery first and then evolved to deep tech. It's great to aspire for what they've done – maybe time for politicians to aspire for 10 per cent+ economic growth rate for 20 years flat before chiding today's job creators. Maybe time to change 'public discourse' from history to science!" Grover said.

There are others who are in total agreement with Goyal. "I have been speaking about this in my keynote addresses for the last three years. We are once again displaying a bottom-of-the-pyramid mindset when it comes to our most glorified startups. VC money id also going into these low-end quick fixes. In the bargain, while the US, China, and even Europe scrape the skies, we continue to write a self-fulfilling prophesy of being at the mass bottom-end. We need to realize that science and high-tech is the next mass product and service of the future," said Harish Bijoor, Business and Brand strategy expert.