From being predominantly focused on information technology and IT-enabled services, the next 4-5 years will witness substantial growth for startups and unicorns, according to Union Minister of State for Skill Development & Entrepreneurship and Electronics & IT Rajeev Chandrasekhar.

"In 2014, our nation's tech landscape was limited to IT and ITes. However, since then, opportunities have emerged across various domains such as deep tech, AI, data economy, semiconductor design, microelectronics, and high-performance computing," says Chandrasekhar.

"What was once just one-third of the overall tech space has now expanded, presenting immense potential for unicorns and startups. From 108 unicorns I am sure we will reach 10,000 in the next 4-5 years. Today we have over a lakh startups in India and it will increase by 10 times," the minister says.

Chandrasekhar highlighted India's progress in building unicorns and startups, and how they have successfully entered areas in emerging technologies, such as AI, Web 3, and deep tech.

This comes at a time when India's domestic startup ecosystem is going through a funding winter amid global macroeconomic headwinds. Funds raised by domestic startups declined 36% to $3.8 billion across 298 deals in the first half of 2023 as against $5.9 billion in the year-ago period, according to PwC India. This is the lowest funds raised by domestic startups in the last four years. "There is a slowdown in startup funding despite significant untapped capital reserves held by venture capitalists (VCs). Active VC firms in India have secured new funds in the past year and we can expect the pace of investments to pick up in the next few months," says Amit Nawka, partner - Deals & Indian Startups leader, PwC India. "In the interim, there has been an increase in the due diligence being carried out by investors before making investments, both in terms of detailing as well as coverage - from typical finance and legal to areas like technology, HR and business processes - to ensure that the startups have a robust corporate governance framework," Nawka adds.

Speaking on the collaborative efforts between the industry and the government to enhance skill development, Chandrasekhar says through strategic partnerships with both big and small companies, the government now works closely to identify necessary skills, creating a comprehensive framework with the active involvement of academia, communities and corporations.

"In 2014 there were 3 out of 4 Indians who were not skilled. Professionals joined the workforce every year unskilled and this was the legacy and the reason why for many years we had many smart people but they went off abroad. Education and skills were available to the elite part of the society and the rest were left to fend off alone and survive on their own," the minister says, adding that community and corporate partnerships are very important elements to startups.

Follow us on Facebook, Twitter, YouTube & Instagram to never miss an update from Fortune India. To buy a copy, visit Amazon.