India's Climate Tech Startups The New Darlings of VCs, Funders 

“We want to be among the list of unicorns in the next few years. I had never expected this kind of response when I launched this dream project,” Mitra told The Secretariat. Amwoodo — the name derived from a Mauritian word meaning ‘I am sustainable’ — has witnessed revenues growing from a mere Rs 8 lakh in 2019 to Rs 22 crore in 2022-23. Mitra’s target is to touch Rs 60 crore by this financial year-end.

“When I started, I realised that bamboo farmers in India, mostly in the Northeasten region of the country, were not only living in extreme poverty, but also lacked knowledge of how to market the product. They did not know what to do with the bamboo they produced,” Mitra said, adding that China on the other hand, has created an ecosystem connecting bamboo farmers, artisans and factories.

On the sidelines of ‘Parivartan’, a seminar on urbanisation and climate change earlier this month, Mitra added that he didn't need to replicate the Chinese model in India, as it already has the world’s second largest bamboo coverage after China. He added that he is now looking to aggressively tap into international markets.

As the concept of sustainability gains momentum in India, more and more entrepreneurs are now looking to bite into this growing pie. The recent rains and flooding of several Indian cities has once again underlined the need for well thought-out urban planning that is climate resilient.

The organiser of the one-day seminar, The Centre for Global Affairs & Public Policy (CGAPP) — a non-profit thinktank working on areas such as sustainability, climate change and circular economy — noted that risks of unplanned urbanisation are increasing with the exponential growth in urban populations.

Jaipur-based Waya, which manufactures futuristic yet affordable e-bikes for daily commuters, is another startup in the spotlight. Launched barely a couple of years ago, it is now looking to tap into dealer channels to broaden its reach. Until now, it was confined to a B2B model by primarily focusing on hotels, resorts and military stations. Over the next few years, the firm is aiming to touch a valuation of Rs 500 crore. It is also keen on going public.

A close scrutiny of data will reveal that most startups dealing with clean energy and climate have come up only after 2018.

Climate-Focused Startups More Likely To Get Funded

According to climate investment firm Climate Angels, the private sector and climate tech startups will play a crucial role in India — which is aiming to touch net-zero carbon emissions target of 2070 — carving out sustainable solutions that help the environment. Importantly, climate tech firms have a market-expanding nature due to the exacerbating climate crisis, with technologies in this sector expected to cater to an ever-increasing total addressable market, the investment firm said.

In India, investments in climate tech ventures have steadily risen, touching US$1.29 billion in 2023. Between 2018 and 2021, climate tech VC funding registered a record high of US$1.49 billion in 2021, says data portal Statista. In comparison, in 2018, India saw venture funding of only US$0.3 billion in climate tech startups. While there are currently more than 3,000 climate tech startups in the country, the number is set to grow exponentially. 

Rising Awareness, Holistic Focus

“Awareness of climate issues is rising. Compared to earlier, people are now realising that climate issues are not just confined to electric vehicles and renewable energy. The spectrum is much broader, covering other areas including agriculture, recycling, waste and carbon management. For India to make a mark in climate resilience, the focus should be holistic, in order to find long-term solutions,” Nirupama Soundararajan, Founder and Partner, Policy Consensus Centre, said.

More than 80 per cent of India’s population lives in districts that are at risk of climate-induced disasters, the World Bank said in a report last year, adding that the economic loss due to rising temperatures, changing rainfall patterns, declining groundwater levels, could only rise. This could impact jobs and food security in the country.

Soundararajan added that India needs to put in place a well thought-out and all-encompassing strategy to combat adverse climate issues. "We will see many more new players focused on climate issues coming up in India," she pointed out.

Analysts watching this space have one thing in common to say: There is enough space for many more players to come in and make a difference. Needless to say, climate tech firms will also find it easier to get funding from venture capitalists and angel investors.