The engineering R&D and product development market in India is forecast to post a CAGR of 12% to reach US$ 63 billion by 2025, from US$ 31 billion in 2019. As per the Economic Survey 2022, India’s gross domestic expenditure on R&D (GERD) as a percentage of GDP stood at 0.66%.
With over 1.59 lakh Department for Promotion of Industry and Internal Trade (DPIIT)-recognized startups (as of January 15, 2025), India ranks as the world’s third-largest startup ecosystem. Space startups raised Rs. 16,072 crore (US$ 1.9 billion) in the third quarter of FY25, up nearly a fifth from a year earlier, fueled by strong investor interest in rocket launchers and satellite manufacturers, according to a Seraphim Space report.
With a workforce of 5.8 million professionals, India accounts for 28% of the global Science, Technology, Engineering, and Mathematics (STEM) talent pool and 23% of the world's software engineering professionals. India is home to 34,000 technology startups, including 3,600 deep-tech startups, driving innovation in artificial intelligence (AI) and quantum computing.
India's information technology (IT) industry is projected to close FY25 with a valuation of Rs. 24,43,988 crore (US$ 283 billion), surpassing Rs. 25,90,800 crore (US$ 300 billion) in FY26.
India's technology sector is set to play a crucial role in the country’s goal of becoming a Rs. 5,97,17,000 crore (US$ 7 trillion) economy by 2030, contributing around Rs. 85,31,000 crore (US$ 1 trillion) to the Gross Domestic Product (GDP).
India’s job market remained resilient in Q4 FY25, with 82% of employers actively hiring. Demand was highest for roles in software development (29%), data analytics and science (26%), and sales (23%), reflecting the industry’s growing shift toward digital and tech-driven skill sets.
India's gross expenditure on R&D (GERD) as a percentage of GDP has remained stagnant at around 0.7% for about a decade, lower than Brazil (1.16%), South Africa (0.83%) and others.
IT spending in India will grow 10.7% YoY to reach US$ 124.6 billion in 2024, as forecasted by Gartner. India’s bioeconomy was valued at US$ 137 billion in 2022 and aims to achieve US$ 300 billion mark by 2030.
In FY21, the science and technology sector added 1,497,501 employees, becoming India’s top employment generator.
The Union Budget 2025-26 allocates Rs. 20,000 crore (US$ 2.33 billion), to launch a Rs. 1,00,000 crore (US$ 11.82 billion) private sector–driven R&D fund. This initiative aims to boost innovation in deep tech and sunrise sectors, enhancing India’s strategic autonomy in key technology areas.
The India AI Mission has been allocated a budget of around Rs. 2,000 crore (US$ 236.4 million), in 2025-26, a massive increase from Rs. 173 crore (US$ 8.6 million) in 2024-25.
Under the Interim Budget 2024-25, the government announced an allocation of Rs. 8,029 crore (US$ 966 million) to the Department of Science and Technology and Rs. 16,604 crore (US$ 2 billion) to the Ministry of Science and Technology.
In the Interim Budget 2024-25, the government announced corpus of Rs. 1 lakh crore (US$ 12 billion) to promote Innovation and StartUps coupled with a new scheme for Deep Tech StartUps in Defence.
According to Commerce and Industry Minister, Mr. Piyush Goyal, the Indian patent office has granted the "highest" number of 41,010 patents till November 15th, 2023.
The Indian Patent Office has crossed the one lakh mark for the first time this year, with 1,01,311 patents being granted by the department between March 15, 2023, to March 14, 2024, reflecting the government efforts to enhance the intellectual property rights framework.
India is ranked in 7th position in terms of Resident Patent Filing activity in the world.
In India, there are more than 1,580 Global Capability Centres (GCCs), where companies can outsource their product development and receive product engineering services, with the GCC market size crossing US$ 46 billion (as of FY23). These GCCs are home to some of the largest companies, many of which have their largest or second-largest R&D centres located in the country.
Accenture offers a framework for assessing the economic effect of AI for selected G20 countries in its latest AI research studies and forecasts that AI will raise India's annual growth rate by 1.3% by 2035. India's National Artificial Intelligence Strategy prepared by NITI Aayog outlined a way forward to harness the potential of Artificial Intelligence (AI) in different fields. State University Research Excellence (SERB-SURE) to create a robust R&D ecosystem in state universities and colleges; Fund for Industrial Research Engagement (SERB-FIRE) to support research and development to solve critical problems that are relevant to industries in a public-private partnership mode.
