India regulatory risk intensifies for early-stage startups

Oxford Economics report quantifies tighter digital regulations reducing startup creation and VC investment. India early-stage funding contracting sharply (seed -31.8%, angel -25.3%, pre-seed -21.9%). Angel tax abolished in 2026, but DPDP compliance deadline (May 2027) adds new DD requirements. Together Fund raising $170M AI India fund signals sustained institutional appetite. New compliance resources integrated into DD toolkit. Recent sourcing signals include three Indian AI startups (Clairva, Coreworks, eNLife Research) raising pre-seed/seed.