India might be fast becoming the startup capital of the world, but more needs to be done, including having a better ecosystem in place, for the sector to flourish, said Kaku Nakhate, President and Country Head — India, Bank of America. Nakhate was speaking on the second day of the Confederation of Indian Industry (CII) Annual Plenary Session.

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"We need to create an ecosystem to have more startups. They are getting a lot of funding because the new digitisation that we are seeing is actually fueled by new players — we do have a much better ecosystem than we had five years back. But we do need to go to the stage where capital is freely available for people," she added.

Nakhate further mentioned that if we don't create such an ecosystem then the unicorns in India are going to find it hard to survive.

"We have build 89 unicorns but will those unicorns stay unicorns? That is the big question," she said.

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Talking about the concerns with the capital market, she said they should think slightly differently.

"We do always protect the retail investor, but everything cannot be at the lowest base. We really need to have pools of capital looking at India plus the domestic to reach the $5 trillion mark," she added.

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India has set itself the goal of becoming a $5 trillion economy by 2026. The IMF's World Economic Outlook earlier said the size of the Indian economy will increase from $3.2 trillion in 2021-22 to $3.5 trillion in 2022-23 and cross $5 trillion in 2026-27.

Also read: CII President Sanjiv Bajaj calls for institutionalised approach to funding India's startup space