India’s semiconductor market to hit $103 billlion by 2030, fuelled by AI, EVs, and defence

Artificial intelligence (AI) infrastructure, electric mobility and defence modernisation will drive India’s domestic semiconductor market over the next decade, according to a report by early-stage fund Endiya Partners. With data centre capacity expected to surge to 9 GW by 2030 from about 1.5 GW at present, and the IndiaAI Mission already deploying 38,000 graphics processing units (GPUs) against an original target of 10,000, demand for chips is set to accelerate sharply.

India’s domestic semiconductor market is expected to nearly double to $103 billion by the end of the decade from $52 billion in 2024, said the report titled ‘India Semiconductor Ecosystem: From Policy to Execution’.

While the opportunity is massive, the report also highlighted critical ecosystem gaps. Indigenous capabilities in analogue and mixed-signal intellectual property (IP) remain limited, more than 90% of semiconductor equipment and materials are imported, and manufacturing intelligence solutions for yield optimisation are still nascent.


The next 18 months will be crucial as the ecosystem transitions from policy announcements to operational readiness, according to the report.

Indian semiconductor startups raised about $50 million in 2025, up from $28 million in 2024 and $5 million in 2023. For venture capital funds, however, the opportunity lies more in horizontal ecosystem infrastructure than in capital-intensive chip fabrication. The other opportunity is in supply chain localisation around the fab-outsourced semiconductor assembly and test (OSAT) ecosystem, said a deeptech investor.

“This is a fast-paced growth sector. Broadly, there are three to four types of companies emerging in India. Across IP, fabless products, services and AI-driven EDA (electronic design automation), we see a 4-5x growth opportunity in venture investments over the next two years,” Sateesh Andra, managing partner at Endiya Partners, told ET.

These businesses require lower upfront capital, have shorter development cycles and offer scalable, recurring revenue models, making them better aligned with venture economics than full-stack chip fabrication plays, according to the report.

Manu Iyer, founder and managing partner at deeptech fund Bluehill VC, said AI-related chips, including accelerators, GPUs, hyperscale-grade processors and edge chips will account for a large share of demand in India over the coming years. “Chip design and the fabless model remain the biggest opportunity for India, given our talent strength,” he said. “At the same time, scaling up fabrication capacity becomes strategically important if we want to build long-term resilience and not remain dependent on external supply chains.”

The report also highlighted that while design engineers are abundant, product managers, applications engineers and sales specialists who understand both technology and markets remain scarce.

Iyer, who has invested in several semiconductor startups, said that since India hasn’t executed large fab or OSAT projects before, the lack of prior experience could affect how quickly these facilities scale up.