India’s War Tech Needs Funding

JANUS VIEW

India-Pakistan Clash Shows It’s Time To Back Defence Startups

Operation Sindoor has been suspended, not concluded, said Prime Minister Narendra Modi, attesting that terror attacks would henceforth be considered attacks of war, and Operation Sindoor would resume.

Pakistan’s domestic audience is largely happy to go by Islamabad’s claim of having inflicted damage on India over the four days of intense aerial combat between the two countries. International media concurs with the Indian claim of having inflicted serious damage to Pakistan’s defence assets and terror infrastructure, even as India suppressed Pak air defence systems and foiled, for the most part, Pakistan’s cross-border attacks.

Reuters quoted an American source as saying that Pakistan’s China-supplied J-10C shot down a Rafale aircraft. India has not specifically confirmed loss of aircraft, but admitted that losses are part of any combat operation. Losing aircraft does not alter the fact that India forced Pakistan to request the US to intercede and end the war. A day after US vice president JD Vance had disavowed any American interest in this distant war, Trump declared on social media that he had negotiated a ceasefire between India and Pakistan.

This has led to a needless controversy in India, as if Trump’s desire for a Peace Nobel and ignorance of history or current political dynamics away from the US (India and Pakistan have been tussling over Kashmir for a thousand years, he said) is any reflection of New Delhi’s conviction in India’s sovereignty.

India did not set out to go to war with Pakistan. It sought to teach Pakistan that sponsoring terror attacks on India would invite serious retaliation. That lesson would appear to have been taught, at least for the time being.

Capital Crunch

But what becomes clear is that achieving military superiority over Pakistan calls for equalling and surpassing Chinese defence tech. India needs to step up funding for the startups that are working on defence technology as part of the iDEX (Innovations for Defence Excellence) platform and off it. While startups are increasingly attracted to the challenges thrown up by defence establishments, funding is still scarce.

India must encourage pension funds to allocate a portion of their giant corpus to venture capital, so that Indian startups stop depending on western funders and their priorities. Members of India Inc are willing to invest in startups that have proven viability in defence tech. But the point is to permit many more startups to reach the point of viability, including by struggling through honest failures that use up capita. The provision of that risk capital is vital.

MESSAGE FROM MASTERS INDIA

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CORE NUMBER

5.1%

That’s India’s official unemployment rate for April 2025 among individuals aged 15 and above, according to the Ministry of Statistics and Programme Implementation. The government will now publish this data monthly — instead of only quarterly for urban areas and annually nationwide. Male unemployment stood at 5.2%, while female unemployment was slightly lower at 5.0%. Rural joblessness was 4.5%, compared to 6.5% in urban areas. Labour force participation was higher in rural India (58%) versus urban (50.7%). However, at 5.1%, the official unemployment figure is notably lower than the largely referenced private research firm Centre for Monitoring Indian Economy’s April estimate of 7.73%.

Trump’s Tariff Claims. US President Donald Trump claimed that India has proposed zero tariffs on American goods to strike a trade deal that the two countries have been working on, though he did not specify the sectors involved. This comes amid India’s retaliatory tariffs against US steel and aluminium. Trump’s criticism of India’s high tariffs on imports, including cars and agricultural products, has been longstanding. Speaking in Qatar, Trump praised this potential concession but reiterated his demand for US companies like Apple to boost domestic production. Ironically, while Trump pressures Apple to manufacture in the US, the tech giant is expanding production in India, including making all US-bound iPhones there.

Mixed Sales Signals! India’s passenger vehicle sales hit a record 3,48,847 units in April 2025, up 3.9% from 3,35,629 units in April 2024, driven by strong demand for utility vehicles (UVs), according to the Society of India Automobile Manufacturers (SIAM) report. However, two-wheeler sales fell 16.7% to 1.45 million units due to a high base last year, but are expected to recover. Three-wheeler sales dipped 0.7% to 49,441 units. The industry smoothly transitioned to the 2nd stage of On-Board Diagnostics (OBD 2), with two-wheeler exports growing nearly 15%.

Battery Makers Ask for More Time. Ola Electric, Rajesh Exports, and Reliance Industries, grantees of the ACC manufacturing programme, have asked the Centre to relax their deadline with a one-year extension. The Centre had imposed fines on them for delays, and could do so again. In 2021, India announced the ACC production-linked incentive (PLI) scheme to increase the country’s renewable energy capacity and develop an indigenous manufacturing infrastructure. But, in practice, companies that got the scheme have struggled to meet deadlines, because of difficult-to-meet criteria and approval delays, as The Core reported in March 2025. 

Grounded Ties. The security clearance of Celebi Airport Services India Pvt Ltd, a Turkish company that provides ground handling services in India's airports, was revoked by the Ministry of Civil Aviation on Thursday. This was allegedly over "security risks". The company handles ground services in Delhi, Hyderabad, Bengaluru and Cochin. Indian travel companies have also been shutting bookings for Turkey and Azerbaijan over the alleged support of the two countries for Pakistan amid the military conflict.

Fewer Shots At The H-1B. The number of eligible registrations submitted for the annual H-1B visa lottery dropped to just 344,000 in March 2025—the lowest in four years—according to data released by US Citizenship and Immigration Services (USCIS). The Economic Times reported that registrations fell 26% year-on-year, partly due to new rules and a sharp fee hike from $10 to $215. Multiple registrations — which formed over half of all entries last year — now make up just 2%. The updated lottery system assigns equal selection odds to individuals to curb companies from filing multiple entries for the same candidate, aiming to make the system fairer

THE SIGNAL DAILY

Buy Now, Regret Later–The Rise of Consumer Debt in India

In 2018, credit card spending in the country was at 4.6 lakh crore rupees. In the last quarter of the recent financial year, that figure grew by four times, and is now at 21.2 lakh crore rupees. 

Credit feels easy, but sometimes, we don’t read the fine print. Now, some Indians are finding themselves in a never-ending debt trap. 

How does that work? What can you as a consumer do to protect yourself? Check out the latest Signal Daily episode to find out!

At The Signal Daily, We don’t do hot takes. Instead, we’ll bring you deep dives into the ‘how’ and ‘why’ on consumer trends. 

The Core produces The Signal Daily. Follow us wherever you get your favourite podcasts. To check out the rest of our work, go to www.thecore.in.

PODCAST

On Episode 582 of The Core Report, financial journalist Govindraj Ethiraj talks to Anand Kulkarni, Director at Crisil Ratings.

• Indian stocks hit 7-month high since October, Sensex up 1,200 points in sudden jump.

• Oil prices slide sharply as the US and Iran engage with each other.

• Rural India’s telecom consumption is rising sharply even as urban slows down. What does that mean?

• Trump tells Apple to pause manufacturing in India

• India has offered zero tariffs, says Trump, India denies, once again

👥 THE TEAM

✍️ Zinal Dedhia, Salman SH, Kudrat Wadhwa | ✂️ Rohini Chatterji | 🎧 Joshua Thomas