Goyal Slams Indian Startups’ Focus on Food Delivery and “Billionaire Kids’ Ice Cream”, Sparks Industry Backlash
By RMN Pathway Team
Union Commerce Minister Piyush Goyal has ignited a debate within India’s burgeoning startup ecosystem after sharply criticising the prevalent focus on sectors like food delivery, betting, and fantasy sports apps. Speaking at the Startup Maha Kumbh 2025, Goyal urged Indian startups to pivot towards high-technology areas such as semiconductors and artificial intelligence (AI).
His remarks, questioning whether India was content with “dukaandari” (just selling things) and low-paying gig jobs, have drawn strong condemnation from industry leaders, including Zepto CEO Aadit Palicha and former Infosys executive Mohandas Pai.
Goyal expressed his concern that many Indian startups are overly concentrated in consumer-facing internet businesses, particularly food delivery apps. He contrasted this with the startup landscape in China, which he claimed was making significant strides in electric vehicles (EVs), battery technology, semiconductors, and AI.
“What are India’s startups of today? We are focused on food delivery apps, turning unemployed youths into cheap labour so the rich can get their meals without moving out of their house,” Goyal stated. He questioned whether this was the true ambition for India’s future, asking, “Are we going to be happy being delivery boys and girls? Is that the destiny of India… this is not startup, this is entrepreneurship”.
The Minister also took aim at what he described as “billionaire kids” starting “healthy” ice cream and cookies businesses, questioning if India’s future growth should be driven by such ventures rather than technological advancement.
“Fancy ice cream and cookies. I know at least three or four billionaires whose children make one brand or the other, very fancy ice cream and cookies, and run a very successful business,” Goyal noted.
He further elaborated, “Healthy ice cream, zero, gluten-free, vegan; using these terms and good packaging, they call themselves a startup. This is not a startup, it’s an entrepreneurship. This is business,”.
He emphasised the need for startups to focus on preparing the nation for the future, highlighting the “disturbing situation” of only around 1,000 deep-tech startups in India. Goyal also expressed sadness over young startups with bright ideas being sold to foreign companies for relatively small amounts.
However, Goyal’s strong critique has been met with swift and sharp criticism from within the Indian startup community. Zepto CEO Aadit Palicha took to social media platform X to defend Indian startups, arguing that the government should support the creation of “local champions” instead of belittling those trying to bring “technology revolutions”.
He acknowledged the technological progress in the United States and China but asserted the importance of building strong local internet companies first. “We need to build great local champions in internet that generate hundreds of millions of dollars in Free Cash Flow (FCF) first if we ever want to get a piece of great technology revolutions,” Palicha stated.
He further highlighted the significant contributions of consumer internet startups to the Indian economy, including substantial tax contributions, foreign direct investment, and investments in supply chain infrastructure.
Mohandas Pai, a former Infosys executive, also voiced his disagreement with the Minister’s remarks, saying Goyal should not “belittle” Indian startups. He questioned the government’s efforts to support the growth of deep-tech startups.
“Piyush Goyal should not belittle our startups but ask himself what has he done as our Minister to help deep-tech start-ups grow in India? It is easy to point fingers at them,” Pai tweeted.
He further criticised the government’s past treatment of startups, citing the harassment related to Angel tax and the restrictive investment policies for endowments and insurance companies. Pai also mentioned the Reserve Bank of India’s (RBI) alleged harassment of overseas investors on remittances.
The exchange highlights a fundamental debate about the direction and priorities of India’s rapidly expanding startup ecosystem. While the government is keen to foster innovation in deep-tech sectors crucial for long-term national development, many entrepreneurs argue that consumer internet startups play a vital role in economic growth, job creation, and laying the groundwork for future technological advancements.
The discussion initiated by Minister Goyal’s comments is likely to continue, prompting a re-evaluation of what constitutes a “startup” and the kind of innovation India should actively promote. The government’s stance and its policies will be crucial in shaping the future trajectory of the Indian startup landscape.
