The Lift Line

“The next transition is harder: From building technology for the world to owning more of what gets built.” (Roopa Kudva, The Indian Express, 21 October 2026)

Why This Editorial Matters for Your Exam

Roopa Kudva writes in The Indian Express of 21 October 2026 that “India has never had more developers”, yet “capital for the earliest stage of building new technology companies is shrinking.” Her question is who captures the value those developers create, and her answer is that India captures the jobs, the services profits and much of the high-value work, but too little of the products and intellectual property.

This page sets out her four-layer argument, then reads her numbers against their sources, because several have newer figures or a narrower period than the column gives. It also lays out what the government already does for early-stage capital: Startup India, the Fund of Funds for Startups and the angel-tax decision.

UPSC relevance:

  • GS Paper 3: Indian economy: mobilisation of resources, growth, development and employment; investment models; science and technology: indigenisation of technology and developing new technology.
  • GS Paper 2: government policies and interventions for development (Startup India, Fund of Funds for Startups).
  • Prelims: Startup India; Fund of Funds for Startups and Fund of Funds 2.0; SIDBI; AIFs; angel tax; GCCs; NASSCOM and GitHub data.
  • Essay and Interview: talent and capital; from services to products; risk and reward in a career choice.

In the news: For context, Tracxn’s India Tech 9M 2026 report, covering 1 January to 21 September 2026, shows seed funding down 37 per cent to $698 million and early-stage funding up 27 per cent to $4.2 billion, with late-stage funding roughly steady at $5.4 billion. The author reads the gap as capital turning selective just when product ownership is created.

The Crux in 60 Words

India has the developers, the services firms and the global capability centres, so it captures jobs, profits and high-value work. It captures far less of the fourth layer: products, IP and ownership. Ownership is made at the riskiest stage, and seed funding is falling while later rounds grow. The author calls for deep, disciplined risk capital at the earliest stage.

The Four Layers of Value

The author breaks the value of India’s developers into four layers and asks who captures each.

Layer What it covers Does India capture it? (the author) The data
1. Jobs and salaries Employment and pay “India clearly captures this” 59.5 lakh direct employees (NASSCOM, FY26 estimate); 2.36 million in GCCs (Zinnov-Nasscom FY26)
2. Profits and enterprise value Margins and company value “A substantial part of this also stays in India” Export revenue split roughly evenly between Indian service providers and global MNCs, including GCCs (NASSCOM, FY2025 estimates)
3. High-value work and expertise Product engineering, AI, architecture, R&D in GCCs Increasingly, as GCCs move beyond support 2,117 GCCs in India (Zinnov-Nasscom FY26)
4. Products, IP and ownership Who owns the platforms and their recurring revenue “India still has some way to go” Software products about $23 billion of a $315 billion industry (NASSCOM, FY26 estimates)

For more on how global capability centres could gain work from abroad, see our editorial on the US green-card crackdown.

The column’s numbers, with their sources and periods

  • Seed and early stage. The 37 and 27 per cent figures are Tracxn’s, for 1 January to 21 September 2026, not a full nine months. Tracxn is a commercial data platform, so these are its counts, not official statistics. The column adds that this “follows a 30 per cent decline in seed funding in 2025”.
  • Developers. The column says “GitHub estimates that India had 21.9 million developers in 2025, up from 4.5 million in 2020”, citing GitHub. GitHub’s own Octoverse 2025 report says India “added more than 5.2 million developers in 2025”, a little over 14 per cent of GitHub’s 36 million new developers that year, and that India, Brazil and Indonesia “more than quadrupled” their developers on the platform from 2020 to 2025. GitHub’s counts are of accounts on its platform, not of people employed as developers.
  • Contributors. India “now has the largest public and open source contributor base in the world”, GitHub says, but “The U.S. continues to lead in contributions.”
  • Industry size and jobs. The column’s “about 5.8 million people”, and its software-products figure of $16.1 billion out of a $282.6 billion industry, are NASSCOM’s FY2025 estimates of February 2025 (the $282.6 billion includes hardware). NASSCOM’s review of February 2026 puts FY26 revenue at $315 billion (growth of 6.1 per cent), direct employees at 59.5 lakh (against 58.15 lakh at the end of FY25) and software products at $23 billion (from $21 billion in FY25). It also revised FY25 revenue to $297 billion. The column’s GCC figure of 2.36 million is for FY26, so it sits beside an FY25 industry total.

The Issue, Decoded

Concept What it means Why UPSC tests it
Seed funding The first outside capital for a company whose idea is still unproven The stage the column says is shrinking
Early and late stage Later rounds for companies that have shown traction Capital is moving here, which the author calls selectivity
Global capability centre (GCC) A multinational’s own captive unit in India Counted with global MNCs in NASSCOM’s export split
Alternative Investment Fund (AIF) A pooled investment fund; the vehicle through which India’s fund of funds reach startups Fund of Funds for Startups commits money to AIFs, not to startups directly
Fund of funds A fund that invests in other funds Startup India Fund of Funds 2.0, notified on 13 April 2026
Angel tax A tax linked to investment in start-ups; the Union Budget 2024-25 proposed to abolish it “for all classes of investors” A policy hinge for early-stage capital
Value capture Who keeps the jobs, profits, expertise and IP that work creates The column’s frame

The Analysis

1. The author’s case: talent is not ownership. India’s developer numbers are impressive, Kudva writes, but they do not show who captures the value they create. On jobs, profits and high-value work, India does well; on the fourth layer it trails, because “India remains much stronger in technology services and global delivery than in building and owning globally scaled software products and platforms.” Her summary: “The move from talent to services to high-value capability has already happened to a remarkable extent. Ownership remains thin.”

2. Why seed money matters. The fall in seed funding “alongside rising funding for companies that have already demonstrated traction, suggests that capital is becoming more selective.” That may be sensible for investors. Product ownership, she argues, is often created earlier, when the idea is still unproven and failure rates are high, and “someone has to fund conviction before there is evidence”. Tracxn’s wider numbers point the same way: 1,134 funding rounds, down 38 per cent from 1,838; first-time funded companies down 30 per cent to 338; and Series A+ rounds down 23 per cent to 409, “pointing to a market that is backing proven companies over new entrants”, as YourStory’s report of the data put it.

3. The choice before an engineer. A senior engineer in Bengaluru can join an Indian IT company, a global product company, a GCC or a start-up. “GCCs can offer high salaries, global work and increasingly attractive career paths. Start-ups offer the possibility of ownership, but also much greater uncertainty.” If capital is hard to find “precisely when founders are trying to turn ideas into products”, the path from capability to ownership “becomes more difficult”. Research centres, incubators and public programmes help, but “infrastructure and technical capability cannot substitute for capital willing to accept early failure.”

4. What the State already does. The author mentions public funding programmes but names none. For background, the record shows:

  • Startup India, launched on 16 January 2016 with an Action Plan: recognised startups crossed 2.23 lakh as on 31 March 2026, with more than 23.36 lakh direct jobs, and more than 55,200 were recognised in 2025-26 alone, the most in a single year since the launch (PIB, 17 April 2026).
  • Fund of Funds for Startups (FFS 1.0), launched in 2016 “to address funding gaps and catalyse the domestic venture capital market for startups”: its entire corpus of Rs 10,000 crore has been committed to 145 AIFs (PIB, 14 February 2026); by the end of FY 2025-26, more than Rs 7,000 crore had been disbursed to over 135 AIFs, which had invested more than Rs 26,900 crore in over 1,420 startups (PIB, 17 April 2026).
  • Startup India Fund of Funds 2.0: approved by the Union Cabinet on 14 February 2026 with a corpus of Rs 10,000 crore “for the purpose of mobilizing venture capital for the startup ecosystem”, and notified on 13 April 2026. Commitments to AIFs are spread across the 16th and 17th Finance Commission cycles, SIDBI is an Implementation Agency (another domestic agency is also to be selected), and the priority segments include deep tech startups, early growth stage startups supported by smaller AIFs, and technology-driven and innovative manufacturing startups. Read our deep dive on the related SME Growth Fund for a parallel scheme for small and medium firms.
  • Angel tax: the Union Budget 2024-25, presented on 23 July 2024, proposed to abolish the so-called angel tax “for all classes of investors”. A PIB document of June 2025 records: “The ‘Angel Tax’ was abolished for all classes of investors in July 2024.”

The schemes work through AIFs, so whether their money reaches the seed stage depends on the funds they back. For Fund of Funds 2.0, the notification of April 2026 said SIDBI would commence operationalising the scheme as its Implementation Agency.

5. The limits of the argument. The author is careful: “This is not an argument for indiscriminate start-up funding. Most early ideas will fail, and capital should remain disciplined.” She also leaves open whether AI means India will need more developers or fewer. And the developer counts that frame the column are GitHub accounts, which measure participation on one platform, not jobs or skill.

Data and Institutions Vault

Prelims-grade facts:

The funding data (Tracxn, India Tech 9M 2026, 1 January to 21 September 2026):

  • Seed funding: down 37 per cent to $698 million
  • Early-stage funding: up 27 per cent to $4.2 billion
  • Late-stage funding: roughly steady at $5.4 billion
  • Total: $10.3 billion; 1,134 funding rounds, down 38 per cent from 1,838
  • First-time funded companies: down 30 per cent to 338; Series A+ rounds down 23 per cent to 409

The talent (GitHub, Octoverse 2025, 28 October 2025):

  • India added more than 5.2 million developers in 2025, a little over 14 per cent of GitHub’s 36 million new developers
  • India has the world’s largest public and open source contributor base; the US leads in contributions
  • India, Brazil and Indonesia more than quadrupled their developers on GitHub, 2020 to 2025
  • 21.9 million developers in India: the column’s figure, citing GitHub

The industry (NASSCOM, FY26 estimates, February 2026):

  • Revenue $315 billion, growth of 6.1 per cent; FY25 revised to $297 billion
  • Direct employees 59.5 lakh, against 58.15 lakh at the end of FY25
  • Software products $23 billion, from $21 billion in FY25
  • FY2025 estimates (February 2025): $282.6 billion including hardware; workforce 5.8 million; software products $16.1 billion

Global capability centres (Zinnov-Nasscom India GCC Landscape Report FY26):

  • 2,117 GCCs employing 2.36 million professionals
  • GCC revenue about $98.4 billion in FY26

Policy:

  • Startup India: launched 16 January 2016; recognised startups over 2.23 lakh as on 31 March 2026
  • Fund of Funds for Startups (2016): entire Rs 10,000 crore corpus committed to 145 AIFs
  • Startup India Fund of Funds 2.0: Rs 10,000 crore; Cabinet approval 14 February 2026; notified 13 April 2026
  • Fund of Funds 2.0 Implementation Agency: SIDBI (another domestic agency is also to be selected)
  • Angel tax: Union Budget 2024-25 (23 July 2024) proposed abolition for all classes of investors

⚠️ Watch the trap: Tracxn’s “9M 2026” runs to 21 September, not 30 September, and Tracxn is a commercial data platform. India has the largest contributor base on GitHub, but the US leads in contributions. $282.6 billion and 5.8 million are NASSCOM’s FY2025 estimates; its FY26 estimates are $315 billion and 59.5 lakh. Fund of Funds 2.0 invests through AIFs, not in startups directly.

The Debate

The author: capital is the missing layer The other side
Seed funding fell 37 per cent while early-stage rose 27 per cent: capital is turning selective Selective capital may be rational; the author agrees most early ideas fail
Software products are a small slice of a services-led industry Services, GCC jobs and margins are value India already keeps
Product ownership is made before the evidence, so risk capital must come early Fund of funds money exists: Rs 10,000 crore committed under FFS 1.0 and Rs 10,000 crore more notified in 2026
GCCs pull talent with pay and global work, away from start-ups GCC work is moving to product engineering, AI and R&D, building expertise at home
India has never had more developers GitHub counts accounts, and the US still leads in contributions

Balanced verdict: the author’s frame is sound and exam-ready: the measure of a technology economy is what it owns, not how many people it employs. Her data need care. Some are older or narrower than the column suggests, and seed funding is one constraint among several. The policy question is not more money in general but money that reaches the earliest stage, with discipline intact.

How to Think About This

  1. Count the layer, not the head. Developer counts measure participation. Jobs, margins, expertise and ownership are different layers of value. Ask which one a figure describes.
  2. Check the vintage and the period. Read every figure in context: a NASSCOM estimate of February 2025 is not the current figure, and Tracxn’s nine months end on 21 September. Write each number with its source and period.
  3. Separate discipline from scarcity. Investors backing proven firms is not a failure in itself. The policy problem is the stage before proof, where ownership begins.
  4. Follow the public money. India’s fund of funds invest through AIFs. Whether they reach seed-stage founders depends on which funds they back, and on what SIDBI’s operation of Fund of Funds 2.0 prioritises.

Diagram-in-Words

Argument map

Who captures the value India’s developers create?

Roopa Kudva’s argument: a record developer base, four layers of value, the seed-stage gap and her call for risk capital.

India’s developer base More than 5 million developers added on GitHub in 2025 The largest public and open source contributor base; the US leads in contributions 1. Jobs and salaries Captured: 59.5 lakh direct employees (NASSCOM, FY26 estimate); 2.36 million in GCCs 2. Profits and enterprise value A substantial part stays in India 3. High-value work Increasingly captured: GCCs do product engineering, AI and R&D 4. Products, IP and ownership Thin: software products about $23 billion of a $315 billion industry (FY26) four layers of value, in the author’s account Ownership often starts earlier: seed capital Tracxn, 1 January to 21 September 2026: seed down 37 per cent to $698 million Early stage up 27 per cent to $4.2 billion: capital turning selective The author’s call Deep pools of risk capital that can back ideas before the evidence is overwhelming, with capital disciplined
India keeps the jobs, the services profits and more of the high-value work; ownership is the thin layer; the author argues it is often created earlier, when ideas are unproven, and seed capital is shrinking.

Takeaway Box

  • Lift line: “The next transition is harder: From building technology for the world to owning more of what gets built.”
  • The argument: India captures jobs, services profits and high-value work, but “Ownership remains thin”; falling seed funding makes the step to products harder.
  • The data: Tracxn, 1 January to 21 September 2026: seed down 37 per cent to $698 million; early stage up 27 per cent to $4.2 billion.
  • The talent: more than 5 million developers added on GitHub in 2025; the largest contributor base, while the US leads in contributions.
  • The industry: NASSCOM FY26 estimates: $315 billion revenue, 59.5 lakh direct employees, software products $23 billion; GCCs employ 2.36 million.
  • Policy hooks: Startup India (16 January 2016); Fund of Funds for Startups (2016); Fund of Funds 2.0 notified 13 April 2026, SIDBI as Implementation Agency; angel-tax abolition proposed in Budget 2024-25.
  • Mains keywords: value capture, risk capital, product ownership, global capability centres, seed funding, intellectual property, deep tech.
  • Ethics and Interview: a secure, well-paid job against the risk of building something of one’s own.
  • Probable question: “India captures jobs but not ownership in technology. Examine the reasons and suggest measures.”
  • Watch next: how SIDBI operationalises Fund of Funds 2.0, and Tracxn’s full-year 2026 data.

Revision Flowchart

Revision flowchart

Revision flowchart: India’s developers and the value they create

Covers the terms, Prelims pointers and traps, Mains pointers, the way forward, quick recall and a practice question.

Who captures the value India’s developers create? Roopa Kudva, The Indian Express, 21 October 2026 (GS3, GS2) Know the terms Seed funding The first outside capital for an unproven idea Global capability centre A multinational’s own captive unit in India Fund of funds Invests in other funds (AIFs), not in startups directly Prelims pointers Tracxn 9M 2026 (to 21 September) Seed down 37 per cent to $698 million; early stage up 27 per cent to $4.2 billion GitHub Octoverse 2025 India added more than 5 million; largest contributor base; the US leads in contributions NASSCOM FY26 estimates $315 billion revenue; 59.5 lakh direct employees; software products $23 billion Mains pointers Four layers Jobs, profits, high-value work, ownership Ownership remains thin Much stronger in services than in products The engineer’s choice GCC pay and global work against start-up uncertainty Way forward Deep risk capital Back ideas before the evidence is overwhelming; stay disciplined Watch Fund of Funds 2.0 Rs 10,000 crore; notified 13 April 2026; SIDBI as Implementation Agency Measure ownership Products, IP and recurring revenue owned in India PRELIMS TRAPS left: the tempting wrong line · right: the fact ✗ India makes the most contributions on GitHub ✓ Largest contributor base; the US leads in contributions ✗ $282.6 billion is the industry’s current size ✓ FY2025 estimate; NASSCOM’s FY26 estimate is $315 billion ✗ Tracxn’s 9M 2026 runs to 30 September ✓ 1 January to 21 September 2026 QUICK RECALL cover the right column, then check Startup India launched on? 16 January 2016 FFS 1.0 corpus committed to how many AIFs? 145 Fund of Funds 2.0 Implementation Agency? SIDBI GCC headcount (Zinnov-Nasscom FY26)? 2.36 million Angel-tax abolition proposed in? Union Budget 2024-25 MAINS KEYWORDS Value capture Risk capital Product ownership Global capability centres Seed funding Intellectual property Deep tech MAINS PRACTICE GS3 · 250 words India’s technology sector captures jobs and services revenue but owns few globally scaled software products. Examine the reasons, with reference to recent trends in early-stage risk capital, and suggest measures to move India from technology capability to technology ownership.
Revision flowchart: who captures the value India’s developers create. Cover the answers and test yourself.

Sources: The Indian Express, Roopa Kudva, “Who captures the value India’s 21.9 million developers create?”, 21 October 2026; YourStory, Tracxn India Tech 9M 2026 report, September 2026; MediaBrief, Tracxn India Tech 9M 2026; GitHub Blog, Octoverse 2025, October 2025; NASSCOM, Strategic Review 2025 press release, February 2025; ETV Bharat (PTI), NASSCOM FY26 review, February 2026; Business Today, Zinnov-Nasscom India GCC Landscape Report FY26; PIB, Cabinet approves Startup India Fund of Funds 2.0, February 2026; PIB, Startup India Fund of Funds 2.0 notified, April 2026; PIB, Startup India, April 2026; Union Budget 2024-25, Budget speech, July 2024; PIB, “Enabling Business, Empowering Growth”, June 2025.

Source: India's 21.9 Million Developers: Who Captures the Value? — Ujiyari.com | Free UPSC & State PCS Editorial Analysis