TICE Dispatch: From Startup Strains to Trade Turns

Today’s roundup paints a picture of India’s economy and startup ecosystem juggling complexity: growth remains solid, though slightly moderated; inflation has plunged to historic lows while structural questions linger; and investment activity in startups signals both optimism and selectivity. Below are twelve notable developments across government policy, economy, finance and innovation that deserve your attention.

Top News of the Day

Private sector growth slows down

In October, India’s private‐sector growth eased to a five-month low with the HSBC flash composite PMI dropping to 59.9 from 61.0 in September. Although the figure remains well above the expansion threshold of 50, the moderation was driven by weaker activity in services (down to 58.8 from 60.9) even as manufacturing rebounded slightly to 58.4. New orders continued to grow, but at the slowest pace since May. Export demand, particularly in manufacturing, slipped to its weakest in seven months, in part due to rising U.S. tariffs. Business sentiment looking ahead also weakened amid concerns over demand and competitive pressure.

Retail inflation falls to eight-year low

India’s annual retail inflation plunged to 1.54 % in September, the lowest since June 2017. Food inflation entered negative territory for the fourth straight month, pulling headline inflation below the lower bound of the Reserve Bank of India’s target band of 2-6 %. The sharp fall was driven largely by easing prices of vegetables, cereals, oil & fats and pulses, aided by favourable base effects. With inflation this low, monetary policy space has opened up—but economists caution that such rapid decline raises questions about demand strength rather than mere supply relief.

Startup funding leaps year-on-year

During the week ending October 24, Indian startups raised about US $504.6 million, an 83 % jump compared with the same period last year (US $275.3 million) despite a drop in deal count (8 deals vs 20). The surge was driven by larger rounds and investor focus re-tightening on fewer high-potential companies, rather than broad deal activity. While the week’s fundraising remains 25 % lower than the previous week, the strong YoY rise signals renewed investor appetite.

Key data indicator revamp slated for early 2026

The Indian government is preparing a major overhaul of its measurement systems: updates to GDP, retail inflation, industrial output and a new services-sector index are expected early next year. The move underscores policymakers’ intent to refine data architecture and improve transparency—vital for investment decisions and public policy credibility. As India transitions to a more advanced economy, improved metrics become increasingly important.

Exports showing signs of strain

While domestic demand remains robust, India’s export momentum is showing cracks. Survey data indicates new export order growth slowed to a seven-month low, weighed by U.S. tariffs and softer global demand. With external headwinds mounting, sustaining India’s investment-led growth and job creation may depend more than ever on diversifying export markets and value-chains.

Defence procurement gets major boost

The government approved procurement proposals worth approximately ₹79,000 crore from the Defence Acquisition Council to modernise military equipment and capabilities. The move signals continued emphasis on strategic autonomy and leveraging defence-industrial push as part of manufacturing and R&D strategy.

State-business linkages come under scrutiny

Recent disclosures reveal that roughly US $3.4 billion of investment from the state-owned Life Insurance Corporation of India into the Adani Group was drafted despite the group’s legal challenges, raising concerns around governance and institutional risk. For markets, startups and foreign investors alike, clarity and trust around state-business interactions remain key.

Enterprise banking tie-up for startups launched

The Department for Promotion of Industry and Internal Trade (DPIIT) announced MoUs with key banks to provide customised banking, credit and mentorship support to recognised startups. The initiative aims to plug a gap in financial services for early-stage firms, especially as ecosystem dynamics shift towards deeper tech and capital-intensive models.

Trade diplomacy enters high gear with U.S. talks

Officials suggest that India and the United States are “very near” to finalising a bilateral trade deal, with most issues converged. While India remains cautious about rushing into a pact, the potential agreement could unlock export access, supply-chain shifts and alignment in strategic sectors—an important lever for growth in the coming years.

VC firms pivot to deep-tech bets

Indian venture-capital firms are shifting away from traditional fintech and consumer-internet plays toward deep-tech, hardware, defence and semiconductor startups. The recalibration reflects ecosystem maturity: as earlier growth leads saturate, investors look for scalable moats, capital-intensive innovation and export-potential industries.

VC fund targets ₹1,200 crore close by year-end

Early-stage VC firm Unicorn India Ventures announced its intention to close its third fund at ₹1,200 crore by December 2025, with around 80 % of capital earmarked for deep-tech, defence and semiconductor startups. The fund-focus signals investor confidence in India’s strategic sectors and the startup ecosystem’s evolution beyond consumer internet.

Agri-export push via global rice conference

The upcoming Bharat International Rice Conference 2025 is poised to be a major forum for India’s agri-export ambitions. The country aims to enter 26 new markets and sign high-value MoUs, targeting rice exports worth approximately ₹1.8 lakh crore. The initiative underscores the government’s efforts to support rural income, supply-chain linkages and export diversification.

Today’s developments reinforce that India’s growth story remains alive, but the engine is shifting. Inflation has eased dramatically, offering policy space; startup funding has leapt again; and structural policy moves (measurement reforms, trade diplomacy, deep‐tech investing) are underway. Yet the slowdown in export momentum, softening services growth, and heightened scrutiny around governance signal that execution matters more than ever.

For the startup and business ecosystem, the takeaway is clear: sustainable growth will increasingly hinge on exporting value, innovating in hardware and deep technology, and aligning with national priorities. On the macro front, the low inflation gives space, but global headwinds and domestic structural gaps require vigilance. Keep an eye on how these threads evolve in the coming weeks—especially as global equity flows, export data and policy signals converge.