Union Commerce Minister Piyush Goyal has sparked a major debate after he slammed India's startup community at the Startup Mahakumbh. Piyush Goyal unexpectedly dropped a stark comparison between India's and China's startups and asked whether they only want to do 'Dukandari'. Goyal highlighted that many startups in India were overly focused on food delivery and betting and fantasy sports apps, those in China were working on EV, battery tech, semiconductors, and AI. Not only this, but Goyal also pointed out a presentation that outlined the 'Startup Reality Check' between India and China. Below is what the presentation outlined-
India vs China Startup Reality
What India’s Startups Are Doing-
- Food Delivery Apps – Turning unemployed youth into cheap labor so the rich can get their meals without moving
- Fancy Ice Cream & Cookies – Marketed as “healthy” while everyone knows ice cream will never be healthy
- Instant Grocery Delivery – Making people impatient and lazy while wasting resources on hyper-fast logistics
- Betting & Fantasy Sports Apps – Encouraging gambling and addiction instead of real economic productivity
- Reels & Influencer Economy – Creating a culture of mindless entertainment instead of real knowledge or skills
What China’s Startups Are Doing-
- EV & Battery Tech – Dominating global electric vehicle production with companies like BYD
- Semiconductors & AI – Investing heavily in self-reliance, building chips and AI models for the future
- Robotics & Automation – Creating next-gen factories that produce more efficiently than anywhere in the world
- Global Logistics & Trade – Building supply chain giants like Shein, DJI, and Alibaba that dictate global commerce
- Deep Tech & Infrastructure – Investing in space tech, high-speed rail, and renewable energy at massive scales
What did Piyush Goyal say against Indian Startups?
Addressing the Startup Mahakumbh, Goyal said, "Do we have to make ice cream or chips? Dukaandari hi karna hai (Do we want to just sell things)..What are India's startups of today? We are focused on food delivery apps, turning unemployed youths into cheap labour so the rich can get their meals without moving out of their house," Goyal said, adding, "Only 1,000 startups in India's deep-tech space is a disturbing situation."
How did the Indian Startup boss react to criticism?
Mohandas Pai, former CFO of Infosys and a prominent investor posted on X, "These are bad comparisons. India has startups in all those areas too but they are small. Minister @PiyushGoyal should not belittle our startups but ask himself what has he done as our Minister to help deep tech start ups grow in India?”
“We have a hostile @FinMinIndia @nsitharaman who harassed start ups on Angel tax for many years, do not allow endowments to invest, insurance cos still do not invest whereas they do globally. @RBI regularly harasses overseas investors on remittances and AIFs, treat them badly, cos FE rules. China invested 845 billion dollars from 2014 to 2024. India only 160 billion dollars! Why is Minister @PiyushGoyal @AshwiniVaishnaw not helping solve these issues?"
'Easy to criticise' writes Aadit Palicha, Zepto Founder Aadit Palicha
Aadit Palicha took to his X handle and posted a long over the debate. Aadit Palicha wrote-
"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. Using our example, the reality is this: there are almost 1.5 Lakh real people who are earning livelihoods 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 organizing 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.
Why doesn't India have its own large-scale foundational AI model? It's because we still haven't built great internet companies. Most technology-led innovation over the past 2 decades has originated from consumer internet companies. Who scaled cloud computing? Amazon (originally a consumer internet company). Who are the big players in AI today? Facebook, Google, Alibaba, Tencent etc. (all started as consumer internet companies). Consumer internet companies drive this innovation because they have the best data, talent, and capital to put behind it. We need to build great local champions in internet that are generating hundreds of millions of dollars in FCF first if we ever want to get a piece of great technology revolutions. The startup ecosystem, the government, and the owners of large pools of Indian capital need to actively support the creation of these local champions, not pull down the teams that are trying hard to get there.
Zepto is still far away from being a great Internet company that can hold a candle to the global best. But we are executing day in and day out to get there. I can promise that any capital we generate from this business (and it honestly looks like we will) will be invested towards long-term innovation and value creation in India. That is essentially what I am dedicating the next few decades of my life to try to do: create dynamism in the Indian economy and our capital markets, in the same way the Americans have for decades. We have the talent and capital; we just need the execution."