AI and Semiconductor Design to Drive India’s Next Innovation Wave, Says Founders Forum CEO
For decades, India’s technology story was written in the language of services: IT consulting, business process outsourcing, and software maintenance. The country built world-class talent and global credibility, but the underlying intellectual property—the chips, the algorithms, the core technologies—largely belonged elsewhere.
That story is being rewritten.
At the recently concluded Founders Forum India in Mumbai, Carolyn Dawson, CEO of the global platform that connects leading entrepreneurs, investors, and corporates, offered a clear diagnosis of where India’s next wave of innovation will come from. In an interaction with The Economic Times, she identified artificial intelligence and semiconductor design as the twin engines that will drive India’s next phase of global trade and innovation leadership .
“Semiconductor design is the one I would watch most closely. India has the engineering depth, and the pipeline is strengthening as supply chains diversify. But the bigger structural advantage is scale: solving problems at a billion-user level creates proof points no other market can replicate.”
— Carolyn Dawson, CEO, Founders Forum Group
The Semiconductor Surge: From Design Leadership to Manufacturing Scale
The numbers behind India’s semiconductor ambitions are staggering. According to the Ministry of Electronics and Information Technology (MeitY), India already hosts about 7% of the world’s semiconductor Global Capability Centres (GCCs) and employs nearly 20% of the global semiconductor chip design workforce . Indian engineers are now designing chips at advanced nodes, including 2nm technology, contributing to cutting-edge semiconductor development for global markets .
The India Semiconductor Mission (ISM) 1.0, launched in December 2021 with a ₹76,000 crore incentive framework, has already approved 10 projects with a total investment of ₹1.60 lakh crore across six states . These include silicon fabrication units, silicon carbide fabs, advanced packaging facilities, and specialised assembly and testing infrastructure.
What’s coming in ISM 2.0:
| Aspect | Details |
|---|---|
| Budget Allocation (FY26-27) | ₹1,000 crore |
| Focus Areas | Equipment and materials, full-stack Indian IP, supply chain fortification |
| Technology Roadmap | 3nm and 2nm nodes by 2035 |
| Market Target | $100-110 billion domestic semiconductor market by 2030 |
| Domestic Capability Goal | 70-75% of chip requirements met locally by 2029 |
The government’s vision is clear: move beyond design leadership—where India already contributes 20% of the world’s semiconductor design teams—to become a leader in advanced manufacturing . At least four semiconductor plants are expected to commence production in 2026, with the remaining following in due course .
The AI-Semiconductor Convergence
The strategic convergence of the India AI Mission and the India Semiconductor Mission is not accidental. As S. Krishnan, Secretary of MeitY, noted at the India AI Impact Summit 2026: “Semiconductors are central to the AI story, just as AI is increasingly central to the semiconductor story” .
This convergence is playing out in startup funding, government policy, and industry collaboration.
Recent Semiconductor Startup Funding:
These startups are not building software on top of existing chips—they are building the chips themselves, and the AI tools to design them faster. Tattvam AI, for instance, aims to reduce chip design timelines from 2-3 years down to weeks by building reasoning models that understand circuits from first principles .
From Design to Manufacturing: The Talent Pipeline
A recurring theme across government announcements and industry analysis is that semiconductor capability is defined not by infrastructure alone, but by the depth of knowledge that runs it .
Key workforce development initiatives:
| Initiative | Impact |
|---|---|
| Design Linked Incentive (DLI) Scheme | 24 semiconductor design startups supported; ₹650 crore in VC funding raised |
| Chips to Startup Programme | 315 universities accessing EDA tools; 185 lakh+ tool hours logged |
| DHRUV64 Microprocessor | Fully indigenous 64-bit processor developed by C-DAC |
| Academic Programmes | B.Tech in VLSI design, Diploma in IC manufacturing, minor degrees |
The IISc “SemiFirst” collaboration with industry was highlighted as a working model, combining simulation-led learning with exposure to real fab subsystems . This approach prepares students for the operational complexity of modern semiconductor manufacturing rather than for narrowly defined roles.
Union Minister for Electronics and IT, Ashwini Vaishnaw, noted the nationwide momentum: “From Assam to Jammu and Kashmir, from Kerala to Tamil Nadu, students across nearly every part of India are now designing chips themselves” .
The Global Tech Corridor: Founders Forum’s Role
The Founders Forum India event, held in Mumbai in March 2026, convened over 130 founders, CEOs, and capital allocators from across India, alongside global investors and corporate leaders . The invite-only gathering was hosted in partnership with HSBC and Boston Consulting Group .
Key themes from the forum:
| Theme | Discussion Points |
|---|---|
| Evolving definition of unicorns | In a more measured funding environment, sustainable growth matters more than headline valuations |
| India’s multi-market scale paradox | Navigating the complexity of serving diverse domestic markets |
| Capital deployment | Current state of VC funding and investor decision-making standards |
| AI applications | Practical, real-world uses of artificial intelligence within business |
| Global expansion | Transitioning from India market leadership to international scale |
Carolyn Dawson articulated the platform’s long-term vision: “The most durable corridors are built by founders who trust each other, and that peer-to-peer network travels further and faster than any company can go alone. That’s why Founders Forum exists and why we’re so excited to once again host a flagship forum in India” .
The forum served as a platform to highlight the global ambitions of Indian entrepreneurs while strengthening connections between Indian founders and the international investment ecosystem . Discussions focused on building enduring companies with strong technological foundations and long-term capital partnerships.
India’s Structural Advantages
Boston Consulting Group (BCG), in a report launched at NASSCOM Technology and Leadership Forum (NTLF) 2026, mapped out India Tech’s next phase . The report noted that while India commands 15-17% of the global IT Consulting and Services market (which constitutes 83-85% of India Tech today), the next decade’s disproportionate value creation will come from segments that are capital intensive, IP-led, R&D-driven, and ecosystem-dependent .
The BCG framework for India Tech’s next innings:
| Strategic Pillar | Actions |
|---|---|
| Accelerate and reset the core | Modernise IT services leadership with AI-driven productivity and IP-enabled offerings |
| Invest in Big Bets | Semiconductor ecosystems, data centre infrastructure, cloud platforms, deep tech |
| Grow the TAM with adjacencies | AI-driven analytics, end-user devices, India stack-enabled platforms |
The report emphasised that unlocking this transition requires coordinated action across five dimensions: reinventing the tech talent pyramid, strengthening commercialisation and business resilience, scaling through structured partnerships, fuelling frontier innovation with patient capital, and aligning policy with technological ambition .
What This Means for Startups
For founders and entrepreneurs, the convergence of AI and semiconductor design creates several distinct opportunities:
1. Design-Led Differentiation
With access to advanced EDA tools through government programmes and a growing pool of design talent, Indian startups can build proprietary chips for specific applications—AI inference at the edge, power management for EVs, optical interconnects for data centres.
2. AI-Native Services
As Dawson noted, the real opportunity lies where India’s AI capabilities intersect with sectors it already dominates: financial services, healthcare, and enterprise software . Startups that can embed AI into core business workflows—not just add it as a feature—will capture value.
3. Global Ambition from Day One
The best founders are now building for global markets and sustainable growth from the outset. As Dawson observed, “Start-ups in India have a vast domestic market, but this can make the transition from national to international even more challenging. International scale is achieved far more easily with a global mindset from day one” .
4. Patient Capital Readiness
Semiconductor and deep-tech ventures require longer timelines and larger capital commitments than software startups. Founders must be prepared to articulate technical milestones, build credibility with specialised investors, and demonstrate progress toward commercialisation.
5. Regulatory Navigation
As global trade policies shift and geopolitical unpredictability increases, founders who can navigate data governance, IP protection, and cross-border compliance will have a structural advantage. Global founder networks, like those facilitated by Founders Forum, can act as a “cushion against this volatility” .
The Road Ahead: From Consumer to Creator
Union Education Minister Dharmendra Pradhan, speaking at the closing ceremony of the Bharat Innovates Deep-Tech Pre-Summit 2026 at IIT Bombay, expressed confidence that India will not only meet its own technological needs but also those of all emerging economies in the Global South .
“In the next decade, India will lead the deep-tech sector.”
— Dharmendra Pradhan, Union Education Minister
The summit featured 137 start-ups interacting with around 200 investors and 80 corporates, showcasing the depth of India’s deep-tech pipeline . The event was a precursor to the global launch of Bharat Innovates 2026 on the sidelines of the G7 Summit in France, under the India-France Year of Innovation .
The convergence of AI and semiconductor design is not merely a technological shift—it is a structural repositioning of India in the global economy. From being a consumer of technology, India is transitioning to a creator of frontier technologies, with startups leading the charge.
The Final Word
The twin engines of AI and semiconductor design are firing in unison. Government policy through ISM 2.0 and the India AI Mission is creating the enabling environment. Startup funding is flowing to deep-tech ventures building chips and AI systems. Global platforms like Founders Forum are building the connective tissue between Indian founders and international capital.
As BCG’s report concluded, “India’s first technology innings established credibility. The next must establish ownership” .
The question is no longer whether India can participate in the global deep-tech economy—it is whether Indian startups can lead it. If the current momentum in AI and semiconductor design is any indication, the answer is increasingly clear.
