India’s Next Deeptech Frontier

Introduction

For decades, India's been recognised for its software prowess, from powering global enterprises to financing startups and shaping the IT transformation. But beneath this digital layer, a quieter revolution is taking place. A new wave of semiconductor startups in India, photonics startups in India, FPGA-based innovation, and intelligent software systems is quietly redefining the country’s technological future.
The global semiconductor Industry is at $600B and growing at 15% per year. New Age Applications are coming up across AI, IoT, Wireless, data centres, automotive, space and defence, pushing for new innovations and opportunities for startups.
Geopolitics / Supply chain interdependence, along with re-shoring and decentralising of critical semiconductor resources, supported by Government of India incentives such as the ISM, DLI, C2S, and TTDF, have been put in place.
This revolution determines whether India remains a consumer of global hardware or emerges as a creator of next-generation deeptech infrastructure.

Why 2025–26 Is India’s Moment for Deep-Tech Leadership

The India Semiconductor Mission (ISM), supported by a ₹76,000 crore fund, is moving ahead to boost local manufacturing, design and talent. Additionally, semiconductor projects worth over ₹1.6 lakh crore have been approved across 6 states, including Gujarat, Assam, Andhra Pradesh, Punjab, Odisha and Uttar Pradesh.
At the same time, global supply chains are undergoing a fundamental reset. Overdependence on a few geographies is now seen as a strategic risk, prompting countries to secure their own semiconductor manufacturing and design abilities. For India, this shift is a chance to move from being on the edge to being a key player in the value chain. It's also something India needs to do.
Investor interest is increasing. According to recent stats, deep-tech startups in India got over USD 1 billion in funding in 2024. New funds are appearing that target chip design startups, photonics startups, and FPGA and AI hardware innovation. The U.S.–India Deep Tech Investment Alliance, started in 2025 with a $1 billion commitment, shows the confidence of global investors in India’s deeptech maturity.
Even the government-led advancements, such as ISRO’s Vikram 3201 - India’s first in-house 32-bit space-grade processor, prove that Indian talent can certainly compete globally.

Where India’s Semiconductor and Deep-Tech Future Will Be Built

In 2025–26, these five deep tech areas will be the ones to watch, as they hold the potential for India’s next phase of growth.

(i) Chip Design and Fabless IP Creation

India’s engineering talent along with the + RISC-V momentum, creates space for startups building AI/ML accelerators, edge processors, and DSP/vision chips or Compound semiconductors like GaAs, InP, GaN, SiC. They have use cases in processing over the Edge AI, space, defence and telecom.

(ii) FPGA Systems as the Bridge Between Hardware and Software:

With FPGA and AI hardware innovations, Indian innovators can quickly test AI accelerators or specialised computer designs. This can be done without spending a lot on factory costs. If AI comes first, being able to reconfigure is crucial.

(iii) Photonics Powering the Next Decade:

Photonics startups in India are popping up in areas like LiDAR, quantum communication, and high-bandwidth optical computing. As photonic integrated circuits move closer to being sold, India has a chance to jump in early with solid scientific support.

(iv) Intelligent, Software-Defined Hardware:

India's software skills provide a key edge in embedded software, AI design tools, and simulation platforms. Hardware that changes with software can transform things, helping deep tech startups succeed.

(v) Communication / RF and Power Electronics

India has a massive opportunity to build RF front-end, SATCOM, RF MMICs, beamforming ICs, and space-grade components. Startups can innovate in SiC diodes, MOSFET modules, EV inverters, chargers, and industrial motor drivers for EV, Solar and Industrial automation use cases.

(vi) Advanced Packaging and System Integration:

As Moore’s Law slows, changes are happening at the system level, with modular chiplets and mixed packaging. Government-supported OSAT programs (Assembly, Testing, Marking & Packaging) can help India quickly create local value.

Hence,

Combined, these six areas – chip design startups, FPGA systems, photonics, intelligent software, and advanced packaging – make up the base of India's deep tech semicon strategy for the next 10 years. Semiconductor startup landscape Built with Startup Landscape

Semiconductor and Deep-Tech Future Will Be Built”

At the same time in India, globally, there is an intense battle between IronWood - Google’s TPU and Nvidia’s Blackwell GPUs. Semicon startups have achieved notable milestones recently - Mindgrove taped out their first ‘Secure Over the past 5 years, $300M have been invested in Indian semicon companies and startups. Semicon startups have achieved notable milestones recently - Mindgrove taped out their first ‘Secure IOT’ chip, Incore unveiled a six-core RISC-V test chip to accelerate design adoption, Calico Tech taped out a POSIT-based design, LightSpeed Photonics is working on LK100 and LK28 optical interconnects for data centres. A few mergers & acquisitions have made this sector promising, with Tejas Networks acquiring Saankhya Labs for $37M, Infosys’s acquisition of Insemi for $33M and SiliConch by L&T Semiconductor for $16M.

Navigating the Challenges

The semiconductor industry needs big investments and comes with risks. Making factories takes time, and getting good results needs constant work. Experts in device physics, EDA, and materials are hard to find.
But every big industry started this way. In the 1990s, people doubted India's IT services. Now, it employs over five million people and makes up almost 8% of India's GDP. What made that transformation possible was patient capital, policy continuity, and private ambition, the same forces now driving India’s deeptech ecosystem.
Investors and deep-tech accelerator programs can help startups reduce risk by funding projects based on goals, working with other investors, and using government help. Becoming a leader in semiconductors and AI hardware will take time, like becoming a software leader did. Having a belief matters more than being perfect from the start.

Why This Matters

This isn't just another industry story; it's about generations to come. India's capability to construct, plan, and improve its computing and communication setup will shape its place in the world, both politically and economically, for many years.
For a long time, Indian engineers coded for global hardware. Now, they're able to plan the hardware itself, along with the smart software driving it. The convergence of silicon and syntax, hardware and logic, is creating startups that defy old labels: semiconductor startups in India, photonics startups in India, FPGA innovators, and software-driven hardware companies.
The founders who get this combination will shape what's coming next.

Final Thoughts

If you are working on edge devices, compound semiconductors, photonics, Communication / RF, Power electronics, processors or FPGA acceleration, then this is the moment to build boldly. The opportunity is here, and India is ready to lead.
This is India’s deep-tech decade. The time to act is now.

Sources:

ISM Funding:
https://www.pib.gov.in/PressNoteDetails.aspx?NoteId=154968&ModuleId=3

Semiconductor:
https://government.economictimes.indiatimes.com/news/digital-india/three-projects-with-net-investment-of-1-25-lakh-cr-herald-the-rise-of-indias-semicon-ecosystem-ceo-ism/108565583

U.S.–India Deep Tech Investment:
https://www.entrepreneur.com/en-in/news-and-trends/indias-deeptech-dream-needs-more-than-funding/489567

ISRO Vikram 32:
https://www.isro.gov.in/vikram3201.html?utm_

Chip Design:
https://www.pib.gov.in/PressReleasePage.aspx?PRID=2159727&