Zepto CEO claps back at Goyal, highlights startup impact

Aadit Palicha argued that consumer internet companies drive innovation through access to data, talent, and capital, stressing the need for government and investor support to help these companies scale and become global technology leaders

Zepto co-founder Aadit Palicha has strongly come to the defence of India’s consumer internet startups, emphasising their crucial role in driving innovation and economic growth. His remarks followed recent criticism from Union Minister Piyush Goyal, who questioned the focus of Indian startups on consumer internet sectors rather than deep-tech industries like AI and robotics.

Palicha expressed his concerns on social media platform X, acknowledging the tendency to compare Indian startups to global players in the US and China. However, he emphasized the significant achievements of companies like Zepto, particularly in terms of job creation and tax contributions.

“It is easy to criticize consumer internet startups in India, especially when you compare them to the deep technical excellence being built in the US/China,” Palicha wrote. He highlighted that Zepto, which launched just 3.5 years ago, now provides livelihoods for over 1.5 lakh people, contributes ₹1,000 crore in taxes annually, and has attracted more than a billion dollars in Foreign Direct Investment (FDI).

Palicha backs consumer internet startups

The Zepto co-founder’s defence comes after Union Minister Piyush Goyal’s remarks at the Startup Mahakumbh 2025, where he questioned whether Indian startups were truly adding value to the economy. Goyal expressed concerns over the rise of gig economy jobs and called for a focus on deep-tech industries. He also noted that India’s startup ecosystem still lacked a strong foundation in critical fields like AI and robotics, comparing India’s tech growth to that of China, which has heavily invested in deep-tech innovation.

In response, Palicha stressed that India’s lack of large-scale foundational AI models is linked to an underdeveloped consumer internet sector. “Why doesn’t India have its own large-scale foundational AI model? It’s because we still haven’t built great internet companies,” Palicha said. He pointed out that major global players such as Amazon, Facebook, and Google all started as consumer internet companies but later expanded into tech domains like cloud computing and AI.

Palicha also argued that consumer internet companies drive innovation due to their access to vast amounts of data, talent, and capital. He emphasized the need to support these companies as they are vital in scaling technological advancements. “Consumer internet companies drive this innovation because they have the best data, talent, and capital to put behind it,” Palicha explained. He further called for a concerted effort from the government and investors to foster these companies, enabling them to become global technology champions.

Palicha and Pai demand startup support

Palicha also pointed out that government and capital support are crucial to creating these local champions in the consumer internet space. “We need to build great local champions on the internet that are generating hundreds of millions of dollars in free cash flow (FCF) if we ever want to get a piece of great technology revolutions,” he said.

This defence of consumer internet startups was echoed by Mohandas Pai, former board member of Infosys, who also criticized Minister Goyal’s comments. Pai questioned what the government had done to promote the growth of deep-tech startups in India and expressed frustration with the lack of startup-friendly policies.