India’s startup world isn’t taking Piyush Goyal’s comments lightly. On April 4, at the second edition of Startup Mahakumbh in New Delhi, the Union Minister of Commerce and Industry took a swing at the country’s startup ecosystem—questioning whether India is only meant to “make ice creams and chips” or settle for selling things instead of chasing deeper technological breakthroughs.
“Do we have to make ice creams or chips? Dukandari hi karni hai?” Goyal asked the audience, drawing comparisons with China’s tech prowess. He also criticised the focus on low-paying gig jobs and consumer apps, implying that the startup scene in India might be chasing the wrong dreams.
Aadit Palicha, CEO and co-founder of quick commerce startup Zepto, hit back almost immediately. Taking to LinkedIn, he said it was unfair and simplistic to pit Indian startups against the US or China’s deep tech innovation.
“Over 1,000+ crores of tax contribution to the government per year, over a billion dollars of FDI, and hundreds of crores invested in fixing India’s supply chain for fresh produce—that’s what Zepto has achieved in just 3.5 years,” Palicha wrote. “If that’s not a miracle in Indian innovation, what is?”
He acknowledged that India doesn’t yet have its own large-scale foundational AI model but suggested that the root cause might not be the lack of ambition. Instead, he pointed out that the biggest breakthroughs in AI and cloud computing globally were actually driven by companies that started out as consumer tech platforms—Amazon, Google, Alibaba, Facebook, and the like.
"Why doesn’t India have an AI giant?" he asked. "Because we haven’t built great internet companies yet."
Palicha wasn’t alone. Former Infosys CFO Mohandas Pai also took issue with Goyal’s tone, questioning what the government has actually done to help deep tech flourish in the country.
In a post on X, Pai pointed fingers back at the system: “Minister Piyush Goyal should not belittle our startups but ask himself what has he done to help deep tech startups grow in India?”
He didn’t hold back, accusing various arms of the government of making life harder for startups. Pai mentioned angel tax troubles, rigid foreign exchange rules, and resistance from banks and insurance companies to invest in venture capital—unlike global counterparts.
He compared India’s total startup investments between 2014 and 2024—₹160 billion—with China’s whopping ₹845 billion in the same period, asking why Indian regulators have been so restrictive.
Ashneer Grover, co-founder and former MD of BharatPe, added his own spin. “China also had food delivery first and then evolved to deep tech,” he wrote on X. “Maybe it’s time politicians aspire for 10%+ economic growth for 20 years flat before chiding today’s job creators.”
Grover also made a cheeky jab at India’s policy focus, suggesting it’s high time the discourse moved from “history to science.”
Rajeev Mantri, founder and managing partner of Navam Capital, questioned the very premise of Goyal’s remarks. He argued that there's nothing wrong in choosing to invest in consumer tech or gaming—sectors where there’s market demand and potential for returns.
“It is terrible to see the Startup Mahakumbh forum being used like this,” Mantri posted on X. “We must not apply a nationalistic moral lens to venture investing.”
Vinay Rai, an agri-entrepreneur and founder of Organic Krate, took the opportunity to highlight a deeper problem—how tough it is for startups to scale in India even when they’re solving real problems.
Rai said his efforts to get a bank loan were repeatedly rejected. His startup, which promotes organic farming and builds farmer networks, has been denied credit by public sector banks on the grounds of “low sales” and early-stage losses.
At the heart of this heated exchange is a growing sentiment among India’s startup founders and supporters: criticism is easy, but where is the structural support to actually build world-class innovation?
Critics argue that if Indian startups are not producing AI giants, the fault doesn’t lie entirely with the founders. Regulatory barriers, funding challenges, and lack of state-backed tech infrastructure may be bigger culprits.
As of now, there's no clear response from Goyal’s office following the backlash. But the message from the ecosystem seems loud and clear—before telling startups where to go, perhaps it’s time to ask what’s been done to pave the way.