India Startup Scenario

VCs Feed India’s Startups
RedHerring has an interesting article giving an overview of tech startups in India.

... the IITs, IIMs, and other Indian universities are trying to incubate brilliant ideas within their own campuses and turn them into successful commercial ventures.
...
The institutes already have a number of success stories to showcase: among them fledgling companies Midas Communications, AirTight Networks, Herald Logic, and Powai Labs. But these companies remain exceptions, not the rule. Like their counterparts in China early-stage companies in India are being drip-fed or starved altogether of cash.

Now read these stats:

In all of India—a country with lots of buzz around tech, the scope to absorb new technologies domestically, and a large talent pool of engineers—the report notes that only six startup-stage and 13 early-stage companies received any venture capital at all in 2004—and that totaled just $126 million. And nearly one in three of those investments went to Indo-U.S. companies like July Systems, inSilica, and Nevis Networks.

I think creating an Ecosystem is the most important part - an ecosystem that guides young lads take the path of entrepreneurship and simultaneously build valuable companies.