Piyush Goyal slams quick delivery startups, praises China’s tech model—founders hit back

A fiery debate has erupted within India‘s entrepreneurial ecosystem after Commerce and Industry Minister Piyush Goyal publicly urged the country’s startups to stop building businesses around food delivery, ice cream and grocery convenience, and instead focus on creating the next wave of high-end, deep tech innovation. Speaking at a startup forum in New Delhi on Thursday, Goyal drew a sharp and controversial contrast between India’s startup ambitions and China’s tech evolution, saying Indian entrepreneurs must decide whether their future lies in “making fancy ice cream” or in developing transformative technologies such as robotics, electric mobility, machine learning, and 3D manufacturing.

His pointed remarks—delivered via a presentation slide titled “India vs. China. The Startup Reality Check”—were interpreted as a direct critique of fast-growing quick commerce platforms like Zomato, Swiggy, and Zepto. These companies have become synonymous with 10-minute deliveries and urban convenience. But for Goyal, they symbolise a startup culture that risks short-term gratification over long-term value creation.

Without naming specific companies, the minister expressed frustration over what he characterised as a proliferation of ventures designed primarily to serve affluent consumers. He said too many startups were enabling the rich “to get their meals without moving out of their house” and turning unemployed youth into “cheap labour.” This, he implied, was not the future that India should aspire to. “Are we going to be happy being delivery boys and girls?” he asked rhetorically, questioning whether this was the entrepreneurial destiny of India.

What sparked the backlash from India’s startup founders and investors?

The minister’s comments triggered an immediate and widespread backlash from founders, venture capitalists, and startup veterans, many of whom took to social media to voice their concerns. Aadit Palicha, the co-founder of Zepto, directly pushed back on X (formerly Twitter), asserting that the government should actively nurture homegrown champions rather than publicly undermine them. Mohandas Pai, chairperson of Aarin Capital and a vocal advocate of India’s digital economy, challenged the minister to reflect on his own role in enabling the rise of deep-tech startups in the country. “What has he done as our Minister to help deep tech start-ups grow in India?” Pai asked, adding fuel to an already heated conversation.

Swiggy and Zomato declined to comment, but the sentiment among tech leaders was clear: rather than belittling the value of services that meet real consumer needs and generate employment at scale, the government should be building the necessary infrastructure and policy frameworks to support deep tech and innovation across sectors.

How does India’s startup ecosystem compare to China’s high-tech model?

The comparison with China was not incidental. China has famously invested billions into hard tech infrastructure, becoming a global leader in electric vehicles, battery systems, robotics, and artificial intelligence. Companies like BYD, CATL, and DJI have not only captured domestic markets but also established themselves as formidable players globally. These outcomes, however, are the result of a coordinated state-led strategy that included subsidies, policy protection, and massive capital deployment over decades.

India, by contrast, has seen its startup boom skew heavily toward consumer-facing apps and services, particularly in fintech, e-commerce, and food tech. While sectors such as SaaS (software-as-a-service), edtech, and healthtech have witnessed some high-end innovation, investment in areas like clean energy, deep tech hardware, or space technology has remained comparatively nascent, though initiatives such as ISRO’s growing private collaboration and the emergence of players like Agnikul and Pixxel hint at future promise.

Despite criticism, it would be short-sighted to dismiss the impact of India’s service startups. Platforms like Swiggy, Zomato, and Zepto have not only created hundreds of thousands of jobs but also established sophisticated supply chain logistics and digital payment ecosystems that serve as a foundation for future tech adaptation. Moreover, many of these companies are backed by global investors who see India as a critical growth market.

What role should the government play in promoting deep tech innovation in India?

At the heart of the debate is a larger policy question: what role should the Indian government play in shaping its startup economy, and how should it balance high-tech aspirations with grassroots job creation and consumer demand?

The government has launched initiatives such as Startup India, Digital India, and the National Deep Tech Startup Policy (NDSP) to foster innovation. These frameworks aim to streamline regulatory approvals, provide access to seed funding, and facilitate industry-academia collaboration. However, critics argue that bureaucratic red tape, inconsistent enforcement, and inadequate infrastructure—particularly outside major metros—continue to hamper startup scalability, especially in complex tech areas like advanced manufacturing and AI.

For deep tech startups to flourish, India would need a far more robust ecosystem that includes research grants, specialised talent, testing infrastructure, and long-term patient capital. Silicon Valley didn’t emerge by urging companies to focus on AI—it evolved through sustained investment in R&D, defence contracts, and university collaborations.

How has India’s startup funding landscape evolved in recent years?

Despite concerns about focus and direction, India’s startup funding scene has rebounded significantly. In 2024, Indian startups attracted $11.3 billion in venture capital investment, marking a 43% increase over the previous year. This uptick came after a challenging 2022–2023 period that saw reduced funding due to global macroeconomic headwinds, including interest rate hikes and recessionary fears in Western markets.

The resurgence in funding indicates investor confidence in India’s long-term digital growth, driven by a young population, rising smartphone penetration, and growing digital adoption in Tier 2 and Tier 3 cities. Notably, quick commerce—despite being controversial—has been among the fastest-growing sectors, with Zepto becoming one of the youngest companies to achieve unicorn status in 2023.

However, even within the venture capital community, there is growing recognition that India’s next leap will require moving beyond consumer services into industrial digitisation, semiconductors, clean energy, and advanced materials. The challenge lies not in replacing delivery platforms with robotics startups overnight, but in enabling both to co-exist and thrive in a balanced ecosystem.

Is there a middle path between convenience-led and deep tech entrepreneurship?

Rather than viewing service-oriented and deep-tech startups as mutually exclusive, industry veterans suggest a more integrated approach. Convenience-led platforms can act as stepping stones, building digital habits, payment systems, and logistics networks that future high-tech solutions can piggyback on. Additionally, service platforms often generate significant cash flow, which can be reinvested into R&D or adjacent innovations.

What India arguably needs is not a rejection of one model in favour of another, but a calibrated strategy that incentivises long-term innovation while respecting the realities of its consumer-driven economy. Startups in the delivery space could, for instance, integrate AI and machine learning for route optimisation, use electric mobility to reduce carbon emissions, or develop predictive analytics for inventory—thus moving closer to the deep-tech agenda Goyal advocates.

Industry observers suggest that governments must facilitate this transition through grants, procurement programs, academic partnerships, and export promotion policies. Just as China backed its industrial champions, India must develop its own tailored model—one that reflects its unique demographic, economic, and infrastructural context.

In this light, Goyal’s comments, while provocative, serve as a conversation starter. They highlight the need for India to look beyond quick wins and aim for strategic depth. But achieving that will require a partnership between policymakers and the private sector, not confrontation.