Nithin Kamath, founder of the Indian financial services firm Zerodha, has emphasized the critical need for India to transition its economic focus from IT services to deeptech hardware development. Kamath stated that the nation can no longer solely depend on IT service exports for long-term growth and must prioritize a more self-reliant technological base to ensure economic resilience.
Moving Beyond IT Services
For decades, India’s IT services sector has been a significant contributor to the economy, driving employment and foreign exchange earnings. However, Kamath suggests that an over-reliance on this sector could pose risks in a rapidly evolving global landscape. He argued that while IT services remain important, the future demands a diversified approach. Deeptech hardware, which includes advanced computing, specialized sensors, and robotics, represents a move toward higher value-added production and industrial innovation.
Addressing Economic Resilience
The Zerodha founder pointed out that a strong domestic hardware industry would provide India with greater control over its technological infrastructure. This strategic shift could insulate the economy from external shocks that often impact outsourcing-dependent models. By developing core hardware capabilities, India can foster a stable economic environment and create sophisticated jobs, moving the country up the global value chain.
Talent and Ecosystem Gaps
Kamath affirmed that India possesses a substantial pool of talented individuals capable of contributing to the deeptech sector. He stated that human capital is not the constraint; rather, the challenge lies in the ecosystem gap. This refers to the lack of support systems necessary to scale innovation, such as funding mechanisms, research infrastructure, and specialized manufacturing facilities. Closing these gaps is essential for indigenous innovation and long-term economic stability.