India's Semiconductor Surge to hit $103 billlion by 2030, fuelled by AI, EVs, and defence

• India's chip market projected to grow from $52B (2024) to $103B (2030)

• Growth driven by AI, electric mobility, and defence sectors

• Data centre capacity expanding from 1.5 GW to 9 GW by 2030

• IndiaAI Mission deployed 38,000 GPUs vs 10,000 target

• 90% of equipment still imported; ecosystem gaps remain

• Semiconductor startup investment reached $50M in 2025

• Design and fabless models offer greatest immediate opportunities

India's semiconductor market is poised for remarkable expansion over the next decade, with artificial intelligence infrastructure, electric mobility, and defence modernization serving as primary growth catalysts, according to new research from Endiya Partners. The early-stage investment firm's report, "India Semiconductor Ecosystem: From Policy to Execution," projects that the domestic chip market will nearly double from $52 billion in 2024 to approximately $103 billion by 2030.

This growth trajectory is being propelled by India's rapidly expanding data center capacity, which is expected to increase from the current 1.5 GW to 9 GW by the end of the decade. The ambitious IndiaAI Mission has already deployed 38,000 graphics processing units (GPUs), significantly exceeding its initial target of 10,000, indicating accelerating demand for semiconductor technology.

Despite these promising prospects, the report identifies several crucial gaps in the ecosystem. India's indigenous capabilities in analog and mixed-signal intellectual property remain underdeveloped, and the country currently imports more than 90% of semiconductor equipment and materials. Additionally, manufacturing intelligence solutions for yield optimization are still in early stages of development.

"The next year and a half represents a critical transition period as we move from policy announcements to actual operational readiness," notes the report, highlighting the importance of execution in this emerging sector.

Investment in Indian semiconductor startups has shown remarkable growth, reaching approximately $50 million in 2025, up from $28 million in 2024 and a mere $5 million in 2023. However, according to deeptech investors, venture capital opportunities appear more promising in horizontal ecosystem infrastructure rather than capital-intensive chip fabrication. Another significant avenue for investment lies in localizing the supply chain around the fab-outsourced semiconductor assembly and test (OSAT) ecosystem.

"This sector is experiencing rapid growth," explains Sateesh Andra, managing partner at Endiya Partners. "We're seeing about three to four categories of companies emerging across India, focusing on IP, fabless products, services, and AI-driven electronic design automation. We anticipate a 4-5x growth in venture investments within these segments over the next two years."

The report emphasizes that these businesses offer several advantages for venture investors: they require less initial capital, feature shorter development cycles, and provide scalable, recurring revenue models. These characteristics make them better suited to venture economics compared to full-stack chip fabrication enterprises.

According to Manu Iyer, founder and managing partner at Bluehill VC, a deeptech fund, "AI-related semiconductors—including accelerators, GPUs, hyperscale-grade processors, and edge chips—will constitute a significant portion of India's demand in the coming years. Given our talent strength, chip design and the fabless model represent India's greatest opportunity. Nevertheless, expanding our fabrication capacity remains strategically vital if we aim to build long-term resilience and reduce dependence on external supply chains."

The research also points out a talent imbalance in the sector: while design engineers are plentiful, there's a scarcity of product managers, applications engineers, and sales specialists who understand both the technological and market aspects of the semiconductor industry.

Iyer, who has backed several semiconductor startups, cautions that India's limited experience with large-scale fab or OSAT projects could impact how quickly these facilities achieve full operational capacity.