Sharmila Devadoss
Co-Covenor, CII Tamil Nadu Startup Panel and Founder & Managing Director, MedIoTek Health Systems Pvt Ltd
Policy and regulatory enablers for innovation-led startups
Accelerating India’s AI & SaaS ecosystem—moving from “vocal for local” to “adopt and amplify”
India stands at a pivotal inflection point in its startup journey. Over the past decade, policy frameworks such as Startup India, Digital India and India Stack have successfully nurtured indigenous innovation and strengthened the “vocal for local” movement. However, the next phase of national competitiveness demands a strategic shift—from merely building local solutions to systematically adopting, scaling and amplifying high-impact technologies. Nowhere is this transition more critical than in the AI and SaaS ecosystem. Policy and regulatory enablers must move beyond facilitation towards active acceleration—simplifying compliance, unlocking public procurement, standardising data access and incentivising platform-led innovation—to position India as a global hub for trusted, scalable digital public infrastructure.
Building on this momentum, we submit that hundreds of Indian new age technology startups and companies that have proven their mettle in demanding enterprise environments, would benefit immensely from the Government’s active encouragement and structured promotion. The time is ripe to help these solutions cross the chasm from pilots to mainstream adoption.
Our appeal: move beyond word-of-mouth to programmatic support
While endorsements matter, measurable outcomes succeed when Ministries, PSUs, and India Inc. are incentivised to adopt domestic solutions. We propose the following practical levers:
Learning from global playbooks— crafting India’s way
For India to grow at an exponential pace, we should, like other successful nations, prefer and scale home-grown solutions where they meet or exceed requirements. Many countries have scaled domestic capability through strategic procurement and rigorous quality—for example, Israel in cybersecurity, France in aerospace/telecom, and South Korea in electronics—while keeping competition and standards at the core. India can and should craft its own values-aligned version—grounded in openness, fair competition, and world-class quality—as part of Atmanirbhar Bharat, Digital India, and Make in India vision.
As this is not merely about market share, it is inclusiveness with national capability building. Each Indian product adopted in a mission-critical stack compounds to stronger IPs, deeper talent pools, and resilient supply chains—keeping value creation in India and turning our homegrown technology companies into global champions. Where strategic control is non-negotiable—critical infrastructure, public safety, and core citizen-data systems—if Indian solutions meet or exceed the bar, evaluation and adoption should prefer domestic options to strengthen resilience and data sovereignty.
India must now institutionalise adoption. By embedding outcome-based procurement, regulatory fast lanes and data sovereignty-by-design across government missions, the Government can convert proven Indian AI and SaaS platforms into core national digital infrastructure—building resilient supply chains, sovereign capability and globally competitive public systems champions.
India stands at a pivotal inflection point in its startup journey. Over the past decade, policy frameworks such as Startup India, Digital India and India Stack have successfully nurtured indigenous innovation and strengthened the “vocal for local” movement. However, the next phase of national competitiveness demands a strategic shift—from merely building local solutions to systematically adopting, scaling and amplifying high-impact technologies. Nowhere is this transition more critical than in the AI and SaaS ecosystem. Policy and regulatory enablers must move beyond facilitation towards active acceleration—simplifying compliance, unlocking public procurement, standardising data access and incentivising platform-led innovation—to position India as a global hub for trusted, scalable digital public infrastructure.
Building on this momentum, we submit that hundreds of Indian new age technology startups and companies that have proven their mettle in demanding enterprise environments, would benefit immensely from the Government’s active encouragement and structured promotion. The time is ripe to help these solutions cross the chasm from pilots to mainstream adoption.
Our appeal: move beyond word-of-mouth to programmatic support
While endorsements matter, measurable outcomes succeed when Ministries, PSUs, and India Inc. are incentivised to adopt domestic solutions. We propose the following practical levers:
- Adoption Incentives for Enterprises: Time-bound tax credits, accelerated depreciation, or GST input benefits for companies that implement qualified “Made-in-India” digital products.
- Procurement Preferences: Outcome-based procurement norms that grant scoring weight to compliant Indian products (security, privacy, data residence), with fast-track pilots in Ministries/PSUs.
- Publish transparent, India-relevant evaluation rubrics: Make RFP criteria and weightings public—security, data residency, regulatory fit, interoperability, total cost of ownership, and local SLA performance—so excellence is comparable and auditable.
- Enforce fair competition with visible oversight: For large/strategic tenders, enable independent observers or periodic audits; release post-award scorecards explaining the winning bid; and institute a time-bound protest/clarification window with public decisions.
- Create a reference-customer & export acceleration pathway: When pilots succeed, designate the deployment as “reference-ready” (evidence-based, not a privilege badge) and list it in a GoI showcase calendar to support multi-state/PSU scale-up and export bids.
- Showcase & Scale Programs: Quarterly GoI showcases of proven deployments and a “Scale in India” pathway enabling multi-state or multi-PSU rollouts for graduating startups.
Learning from global playbooks— crafting India’s way
For India to grow at an exponential pace, we should, like other successful nations, prefer and scale home-grown solutions where they meet or exceed requirements. Many countries have scaled domestic capability through strategic procurement and rigorous quality—for example, Israel in cybersecurity, France in aerospace/telecom, and South Korea in electronics—while keeping competition and standards at the core. India can and should craft its own values-aligned version—grounded in openness, fair competition, and world-class quality—as part of Atmanirbhar Bharat, Digital India, and Make in India vision.
As this is not merely about market share, it is inclusiveness with national capability building. Each Indian product adopted in a mission-critical stack compounds to stronger IPs, deeper talent pools, and resilient supply chains—keeping value creation in India and turning our homegrown technology companies into global champions. Where strategic control is non-negotiable—critical infrastructure, public safety, and core citizen-data systems—if Indian solutions meet or exceed the bar, evaluation and adoption should prefer domestic options to strengthen resilience and data sovereignty.
India must now institutionalise adoption. By embedding outcome-based procurement, regulatory fast lanes and data sovereignty-by-design across government missions, the Government can convert proven Indian AI and SaaS platforms into core national digital infrastructure—building resilient supply chains, sovereign capability and globally competitive public systems champions.
