Odisha, known for its vast mineral resources, has always been seen through the prism of its mineral potential. Its economic story reflected its mineral potential, megaprojects, mining extraction and manufacturing. However, in the last few years, the state has quietly yet affirmatively witnessed a shift—the rise of startups, which is transforming the eastern state of India to move from a resource economy to an innovation economy.
With over 2,055 recognised startups operating across diverse sectors, a dedicated startup fund, participation of women players, the Odisha Startup story has shown promise, despite entering the arena much later than states like Karnataka, Telangana and Maharashtra. It has expanded beyond tier II and tier III cities, making its presence felt at the national landscape.
Through Startup Odisha (launched in 2019) and offering monthly allowances, policy development grants and a Rs 100-crore fund-of-funds, Odisha built one of India’s most inclusive startup policies.
According to data released by Startup Odisha, presently the state has around 26-27 recognised incubators, including university-linked, government-supported, and private incubation centres, which are actively supporting startups across the state. Similarly, incubators in institutions such as NIT Rourkela and IIT Bhubaneswar have begun producing market-ready ventures rather than academic prototypes.
Interestingly, while 40 per cent of startups are led by women founders or co-founders, a fair share of entrepreneurship is led by students or first generation.
Spread across sectors like information technology, agritech, food processing, healthcare, renewable energy, logistics, manufacturing, and social enterprises, Odisha startups reflect not only the gender-inclusive entrepreneurship but also a change in the mindset among the young generation.
Besides, the transformation of campuses into innovation hubs such as the proposed research and entrepreneurship park at IIT, Bhubaneswar and the announcement by Biju Patnaik University of Technology to ensure that every engineering college produces at least one startup signal a structural shift, which could go a long way in turning the state into one of the few states where higher education directly feeds the startup economy.
Most importantly, the fact that Odisha startups have been aligned with its natural and cultural strengths gives them an added benefit. From working on tribal livelihoods and agro-based products to handloom and lifestyle, the startup culture has blended perfectly with the cultural diversity of the state.
However, the challenges remain. The significant decline in the 5th Edition of the States’ Startup Ecosystem Ranking (2024), dropping from a ‘Top Performer’ in 2022 to the ‘Aspiring Leader’ category in 2026, is a pointer towards the gap between initiatives and implementation. If reports are to go by, the state’s national ranking fell from 6th in 2022 to 20th in 2025, largely due to delays in reporting data to Department for Promotion of Industry and Internal Trade (DPIIT).
Challenges
The major constraints include funding. There are very few active venture capitalist funds based in Odisha. Due to this, many founders move their base to other states like Karnataka, Andhra Pradesh, etc. in search of investors, thereby limiting the state as the founders.
Another structural constraint is that the focus is concentrated on a few towns and districts. Presently, Bhubaneswar is the nerve centre of startup activity, large parts of the state remain outside this network. It’s time the focus shifted to other districts as well to ensure the growth of entrepreneurship.
Besides, the mindset of people remains a major issue. There’s still a blockage among the Odias of starting a business vis-a-vis a job, especially a government job. Budding entrepreneurs are yet to get the recognition and support that is required for their success.
The road ahead
As Odisha prepares to present its Budget, it must prioritise and encourage startups by creating a large fund for this sector. Most importantly, adequate steps must be taken to increase a state-backed venture capital participation. The Budget should also address ease of doing business in the state and announce policies such as single-window clearance for startups, time-bound delivery law and innovation-friendly regulatory framework, not to miss out retaining the talent and migration from the state.
Last but not the least, Budget 2026 should address startups of Odisha as a core engine of growth instead of treating it as a side business scheme.
