BEYOND THE USUAL BETS FUNDING INDIA'S STRATEGIC TECH SECTORS

India's private capital is undergoing a period of transition, and a noteworthy realignment is underway: funds flowing into sectoral domains historically viewed either as risky or niche - health-tech, defense, communications, and space.

- BY PRINCE KARIAPPA

These sectors now attract attention because they align with national priorities, have rising domestic demand, and (critically) benefit from clearer government backing. The emerging challenge: can investors build scalable, high-return businesses in these domains without relying purely on subsidies? The pivot is not ad hoc. It reflects structural inflection across three forces, like policy momentum and institutional reform, which reduce execution risk for private actors, domestic demand pressures, especially in health and resilience domains, geopolitics, and supply-chain realignments, which magnify the value of homegrown capabilities. In effect, strategic sectors are no longer optional footnotes in India's innovation story - they are becoming core chapters. Pranav Pai, Managing Partner, 3one4 Capital, said, "As India's GDP moves beyond USD 5T, the venture ecosystem is set for a structural shift. Deep tech, spanning advanced manufacturing, semiconductors, health tech, biotech, AI, and defense, will define the next wave of innovation beyond consumer internet, fintech, and SaaS."

"Startups translating frontier R&D into commercial products will attract both private equity and public grant capital. This demands sustained public commitments so private industry can innovate with confidence. We are already seeing a new generation of founders in these areas, and at 3one4 Capital, we have backed over 15 such companies as part of our deep tech thesis," said Pai.

DEEPER THAN WELLNESS APPS

India’s health sector continues to present a vast canvas of underinvestment. A NITI Aayog report on investment opportunities estimates that in India, there are nearly 600 project opportunities worth USD 32 billion in hospital and medical infrastructure alone.