Investors seem to have finally realized the worth of the Indian startups. According to PrivCo., the venture capital funding to the Indian startups has seen an increase of 261 percent from last year. This has taken the funding figure to a whopping $3.86 billion till date.

As in China, the ecommerce market in India is growing at a quick pace.

"If you look at India's growth and demographic, you can see that the next hot tech market after China is India," said Matt Turlip, senior analyst, PrivCo in a statement to CNNMoney.

Flipkart, which offers a marketplace similar to Amazon and Alibaba, managed to fetch $1 billion in funding in July this year.  According to Turlip, this makes Flipkart one of the best funded startups in the world, not just India.

Snapdeal, a close rival to Flipkart in India, also fetched $653 million in funding in October this year.

SoftBank, the Japanese firm that was an early investor in Alibaba ages ago, has seemed to have found a new interest in the Indian startups market. The Japanese firm has been fuelling huge chunks of money in the Indian marketplace of late. The firm has invested a whopping $800 million in Olacabs and Snapdeal this year. It also has a 36.5 percent stake in ScoopWhoop.

Apart from SoftBank, major venture capitalist firms like Accel Partners and Sequoia Capital have also shown interest in the Indian startup scene.

Five hundred million people in India are expected to come online over the next three to four years on inexpensive smartphones. Majority of these people are also expected to be young and this makes them an ideal ecommerce market.

In order to capitalize on the ongoing boom in the Indian market, Microsoft has decided to bring free internet access to the country by setting up three data centres. According to Satya Nadella, CEO, Microsoft, the company sees a $2 trillion opportunity in the Indian market.

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