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Delhi Bets ₹200 Crore on Startups: Can the capital dethrone Bengaluru as India’s innovation hub?
New startup policy promises funds, infrastructure and inclusivity, but experts say execution and structural reforms will decide if Delhi can rival the Silicon Valley of India.
Bengaluru (right) hosts 52 unicorns, raised nearly $5 billion in 2024 alone, and has a three-decade head. Delhi-NCR (right), in comparison, drew $3.1 billion last year. (Image source: Britannica)
New Delhi is making its boldest pitch yet to shed its political skin and wear the mantle of India’s next big startup hub. The BJP-led government last week unveiled the draft Delhi Startup Policy 2025, anchored by a ₹200-crore venture capital fund, with the ambition of nurturing 5,000 startups by 2035. With provisions spanning equity, debt, and co-investments, as well as operational allowances, patent reimbursements and incubation support, the capital wants to stake a claim in a space long dominated by Bengaluru.
The policy promises much more than cash.
It offers 100% reimbursement on co-working leases, ₹2 lakh per month in operational aid for a year, subsidies for incubation and fabrication labs, and even a digital single-window “Delhi Startup Portal” to simplify registrations, mentor-matching and grievance redressal. Women-led and marginalised-community startups get explicit priority.
“No genuine start-up idea should fail due to lack of support,” Industries Minister Manjinder Singh Sirsa said while releasing the draft.
But Delhi’s announcement immediately triggered the larger question: Can the capital realistically displace Bengaluru- the undisputed Silicon Valley of India- as the country’s startup nerve centre?
Delhi’s strengths: talent, institutions, and capital
Industry voices argue Delhi already has many of the ingredients of a thriving startup ecosystem. IIT Delhi, AIIMS, and Delhi University serve as intellectual anchors, while Delhi-NCR has become a magnet for entrepreneurs across fintech, edtech, e-commerce, and healthcare. NCR also leads India’s flexible workspace market, with nearly half of the country’s total office leasing in 2024.
“Delhi doesn’t need to be the next Bengaluru; it has everything to emerge as its own version of Silicon Valley,” said Ankit Mehra, co-founder of GyanDhan (startup based out of Delhi).
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According to his estimates, IIT Delhi incubated 147 startups between 2018–2024, spanning sectors like AI/ML, IoT, agritech, med-tech, EVs, space tech, and more, while also executing 271 international research collaborations. "Delhi clearly has the space, the academic firepower, and the talent pipeline; the challenge now is to bring them all together."
Venture capital firms, angel networks, and IPO success stories have already given Delhi credibility.
“The real story is the city’s thriving ecosystem, supported by talent, capital and now government assistance. These are the factors that will play a crucial role in shaping its course and supporting India's startup scene as a whole,” said Ankur Mittal, co-founder of IPV.
Where Delhi still lags
Yet, comparisons with Bengaluru show the gap is wide. Bengaluru hosts 52 unicorns, raised nearly $5 billion in 2024 alone, and has a three-decade head start thanks to early IT industry roots, global capability centres, and state-led schemes like Elevate.
Delhi-NCR, in comparison, drew $3.1 billion last year.
Experts also caution against overestimating the ₹200-crore fund.
“For 5,000 startups, this is a rounding error unless used as a de-risking tool to pull in 10–20x private capital,” said Mehra.
Execution efficiency- fast disbursals, transparent dashboards, and credible governance- will make or break the initiative.
There are structural gaps too.
While marquee institutions like IIT Delhi churn out world-class startups, Delhi hasn’t yet harnessed the wider talent pool from its many engineering and professional colleges. Investor networks remain fragmented, and bureaucratic red tape has historically slowed incentive delivery. The higher cost of living in Delhi is another disadvantage compared to Bengaluru.
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Brand guru Harish Bijoor highlighted an even deeper challenge: Delhi’s entrenched identity as a political capital. “Whenever you talk Delhi, you talk politics. To position itself as a startup hub, Delhi needs not just policy shifts but a repositioning of its very image.”
Execution, not ambition, will decide
Policy backers argue this is precisely why Delhi Startup Policy 2025 matters.
It aims for long-term ecosystem building, not short-term incentives. Structured funding, a Startup Task Force, and nodal agency oversight are designed to instill confidence.
“When passed and put into practice, it could enable Delhi to grow into a true startup powerhouse inching toward becoming a global hub,” said Archana Jahagirdar, Founder & Managing Partner of Rukam Capital.
According to her, the draft is aiming to build a long-term, sustainable ecosystem rather than relying solely on short-term financial incentives that will support all early age start-ups. "Delhi already has the essential ingredients for a thriving startup ecosystem. Its connectivity, large consumer base, and access to government institutions create a unique advantage. What Delhi now needs is to deepen enablers like extensive R&D and innovation centers, sector focused hubs that will accelerate its journey toward becoming a truly global startup hub."
Entrepreneurs agree Delhi has the infrastructure and connectivity, but stress the need for execution at scale.
“Bengaluru wasn’t built overnight. Delhi must match speed and depth with execution and patience,” said Arunabh Sinha, CEO of UClean (startup based out of Delhi NCR).
Use the ₹200 crore to crowd in private capital and measure success by time-to-sanction, follow-on money per public rupee, and survival rates, he suggested. "That is how Delhi can realistically chase Bengaluru and lift its global rank. And why just Dubai? Why not aim to beat Dubai and the Silicon Valley?"
For now, Delhi is positioning itself as a startup hub with ambition and inclusivity at its core. But whether it can rival Bengaluru will depend less on policy announcements and more on delivery- how quickly funds flow, how frictionless the systems become, and how effectively the government catalyses private capital and talent networks.
Delhi has thrown its hat in the ring. The next decade will reveal if the capital can truly shift from being India’s seat of power to its engine of innovation.
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