India’s start-up ecosystem, which is propelling the digital economy, is expanding its presence in defence. In a sector notorious for ‘middlemen’ and a less-than-optimal weapons procurement system, start-ups are infusing fresh energy and purpose by innovating niche, cutting-edge technologies for the military. If nurtured properly, these start-ups can transform India’s military capability and achieve tech self-reliance, while building much-sought-after investment linkages with the Silicon Valley.
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India is the world’s largest arms importer. This is ironic, since the country has long sought self-reliance in defence. Those efforts have yielded little. Beyond serial licensed production of equipment in defence PSUs, true self-reliance has proved difficult. In recent years, ‘Make in India’ has attempted to change this by promoting the private sector’s role in defence production and R&D. The production aspect is yielding slow change, but what has received traction is R&D.
In tapping start-ups, India is following the lead set by Israel and the US, which, very early on, saw and seeded start-up innovation for national security.
In the US, the CIA was one of the first to set up a venture capital firm, In-Q-Tel, in 1999. It provided seed funding to several start-ups, including the big data analytics company Palantir Technologies, which played a crucial role in hunting for Osama bin Laden. Today, Palantir is hailed as a ‘tech unicorn’ and is a symbol of the defence innovation base in Silicon Valley and other parts of the US. The Pentagon, too, established the Defence Innovation Unit to work closely with the tech industry and start-ups to shortlist, fund and develop emerging technologies.
Likewise, a thriving defence innovation base in and around Tel Aviv has given Israel a technological military edge in a region surrounded by hostile neighbours.
India began this journey just a few years ago. Today, several start-ups are engaged in developing prototypes and products for the Indian military across technologies. Notable are ideaForge (drones), Tonbo Imaging (imaging and sensor systems), IROV (EyeROV) Technologies (underwater drone) and Axio Biosolutions (surgical and wound care). Among these, ideaForge and Tonbo are already significant players with their combat-proven technologies. For instance, ideaForge’s drones for the military and the paramilitary have been used in many surveillance, reconnaissance and counterinsurgency operations. Tonbo’s imaging and sensor systems improve the lethality of munitions and missiles of the military, and have had their systems’ combat-readiness tested by the US Special Forces and Israel Defence Forces.
The government is also tapping the start-up ecosystem through its flagship Innovations in Defence Excellence (iDEX) program. iDEX works with R&D institutes, academia, industry, start-ups and individual innovators by providing them funding of up to Rs 1.5 crore to create solutions for the military’s technological problems. Since its launch in 2018, iDEX has been hosting the Defence India Start-up Challenge (DISC), which awards start-ups for mentoring and funding, based on their ability to solve specific technological challenges posed by the military. So far, 60 start-ups have been beneficiaries, and iDEX has identified technologies such as soldier protection systems, secure hardware encryption devices, unmanned surface and underwater vehicles, 4G/LTE tactical local area network, foliage penetration radar, artificial intelligence-based satellite image analysis, among others.
As is the norm with defence R&D worldwide, these technologies are dual-use. For instance, IROV Technologies’ underwater drone being developed with the DRDO for surveillance and repair will also have a commercial case. Likewise, Axio Biosolutions, which has created haemostatic dressing—specialised bandages for treating injured personnel in combat—can also be used for similar purposes in any accident or disaster-like situation. These technologies can be used for the homeland security products market, currently dominated by Chinese companies like DJI (drone maker) and Hikvision (IoT solutions and video security systems provider).
The evolving defence start-up ecosystem is enabling a much-needed commercial synergy between India and the US, as many Indian start-ups have participation from Silicon Valley venture firms like Artiman Ventures (Tonbo), Accel and IDG (Axio Biosolutions), Intel Capital (Saankhya Labs), WRVI Capital (ideaForge). This will only expand as India and the US deepen collaboration in defence technology.
One policy change is needed—reduction of the lengthy defence acquisition procedure, which typically takes 7-8 years for major weapons. Longer timelines don’t fit with start-up business models, neither they will be appropriate given the rapid pace of technological obsolescence. The government will need to devise and enforce shorter timelines commensurate with the start-up culture.
The government has correctly internalised the global technological trend. Now it needs to execute it.