Central India’s New Industrial Revolution: How DeepTech and AI Are Forging the Future

Introduction

A quiet but powerful transformation is underway in the industrial heartland of India. Beyond the well-trodden paths of SaaS and e-commerce, a new wave of innovation is gathering momentum. In cities like Indore, Bhopal, and Jabalpur, DeepTech—technology rooted in significant scientific or engineering breakthroughs—is reshaping everything from factory floors to supply chains. Fueled by Artificial Intelligence (AI), this isn’t just another tech trend; it’s the dawn of a new industrial revolution for Central India. This shift matters now more than ever, as it holds the key to unlocking unprecedented efficiency, global competitiveness, and sustainable growth, positioning the region as a critical hub in India’s ambition to become a global technology powerhouse.

What’s Happening: The National Push and Local Momentum

The surge of DeepTech in Central India is not happening in a vacuum. It’s backed by a strong national strategy and validated by impressive data. India is now home to over 3,600 DeepTech startups, making it the sixth-largest DeepTech ecosystem in the world. The momentum is accelerating, with the number of new DeepTech ventures doubling in 2023 compared to the previous year. A staggering 74% of these new startups are focused on Artificial Intelligence, signaling a clear direction for the industry.

This growth is strategically supported by the government’s proposed National Deep Tech Startup Policy (NDTSP), an initiative designed to build a robust ecosystem through targeted interventions. The policy aims to harness innovation for economic growth and establish India as a knowledge-driven economy. Further amplifying this, industry bodies like NASSCOM have called for a ₹10,000 crore DeepTech fund to inject crucial early-stage capital into these ventures. A key trend highlighted in a recent NASSCOM report is the remarkable growth in emerging hubs, with over 110 DeepTech startups founded in Tier-2 and Tier-3 cities in 2023 alone—a twofold increase from 2022. This is where the story of Central India truly begins.

Why It Matters: A Paradigm Shift for Founders, Investors, and Mentors

The DeepTech wave represents a fundamental paradigm shift. For founders, it opens up a new frontier of opportunities beyond conventional software solutions. It’s a chance to solve complex, real-world problems in sectors like manufacturing, agriculture, and healthcare, creating businesses with high entry barriers and significant intellectual property. For entrepreneurs in Indore and Bhopal, this means leveraging the region’s strong industrial base to build solutions for process optimization, quality control, and predictive maintenance.

For investors, Central India’s burgeoning DeepTech scene offers a chance to tap into an underserved market with immense growth potential. While funding saw a dip nationally in 2023, the underlying growth in startup creation points to a resilient and expanding pipeline of opportunities. Investing here is not just about financial returns; it’s about building the foundational companies of India’s next economic chapter. For mentors, including those at TiE Indore, the challenge and opportunity lie in guiding these specialized startups through long gestation periods, complex product development cycles, and the quest for patient capital—a role critical for ecosystem maturity.

How Startups Can Respond: An Actionable Framework

Aspiring DeepTech entrepreneurs in Madhya Pradesh can capitalize on this trend by adopting a strategic approach. The key challenges identified by industry leaders are access to patient capital, forging strong R&D partnerships, and navigating government procurement. Here’s how to respond:

1. Forge Academic Alliances: Collaborate with institutions like IIT Indore and IIM Indore. These hubs of excellence are not just talent pools; they are R&D powerhouses. Joint research projects, leveraging their labs, and engaging with faculty can de-risk technology development and add immense credibility.
2. Focus on Industrial Niches: Instead of broad AI solutions, focus on specific problems within Central India’s key industries, such as textiles, pharmaceuticals, and automotive components. Develop solutions for AI-powered quality inspection, IoT-based predictive maintenance, or robotic process automation for local manufacturing units.
3. Leverage Government and Ecosystem Support: Actively engage with the initiatives under the National Deep Tech Startup Policy. Participate in programs hosted by organizations like TiE Indore, which provide invaluable mentorship, networking, and access to angel investors through platforms like the TiE Angel Network.
4. Build for Resilience: Given the longer development cycles of DeepTech, founders must build lean, milestone-driven roadmaps. Securing non-dilutive funding through government grants and innovation challenges can provide a crucial runway before seeking venture capital.

Key Pillars of the National Deep Tech Startup Policy (NDTSP)

To guide their strategy, startups should align with the core objectives of the government’s policy framework. Here is a structured look at its key priorities:

Local Lens: Indore and Bhopal as DeepTech Hubs

The abstract national trends come to life in the industrial corridors of Madhya Pradesh. Indore, with its vibrant ecosystem, is already home to 34 DeepTech startups, of which 12 have successfully secured funding. Companies like DronaMaps, which uses drones and AI for geospatial intelligence, and Robro Systems, developing AI-powered inspection systems for textiles, are prime examples of this local innovation. These companies are not just building tech; they are solving regional problems with global potential.

The ecosystem is supported by infrastructure like the MPSEDC IT Park and the Electronics Complex in Indore, which provide the necessary facilities for tech companies to scale. In Bhopal, institutions are fostering a culture of innovation, creating a pipeline of talent and ideas. The collective energy is palpable at events like TiE Con MP, where founders, mentors, and investors converge to build the future. This local ecosystem provides a fertile ground for DeepTech to flourish, combining industrial heritage with next-generation technology. “आपणी इंदौर में हुनर की कोई कमी नी है” (There is no shortage of talent in our Indore), a sentiment that echoes the region’s quiet confidence.

Takeaways: A TiE Mentoring Perspective

From a mentorship standpoint at TiE, the rise of DeepTech in our region is both exciting and demanding. It requires a shift in our advisory approach, moving beyond traditional business models to guide founders through the complexities of technology risk, IP strategy, and long-term fundraising. Our role is to connect these brilliant minds with the right mentors—industry veterans who have scaled complex technology businesses. We must champion patience and resilience, reminding founders that building a DeepTech company is a marathon, not a sprint. The practical action for any aspiring founder in this space is to seek mentorship early. Engage with the TiE community, join our mentorship programs, and build a network of advisors who can help you navigate this challenging but immensely rewarding journey.

Conclusion: From Central India to the Global Stage

The emergence of a DeepTech and AI ecosystem in Central India is a testament to the region’s latent potential and the nation’s strategic vision. This is more than just a story about technology; it’s about a new generation of entrepreneurs who are building the future, brick by brick, algorithm by algorithm. As these startups mature, they will not only transform local industries but also make a significant mark on the global stage. The journey is just beginning, but the message is clear: the industrial heart of India is beating with the pulse of innovation, ready to power the nation’s DeepTech ambitions. For the bold and the visionary, there has never been a better time to build in Central India.