New Delhi/Mumbai: India’s semiconductor sector is reaching a critical phase, as startups like Netrasemi want the government to help them with commercialization, in addition to funding. The Zoho-backed chip design startup said that commercialization, not just development, is where the chip ecosystem is most in need of support.
Speaking ahead of Semicon India 2026, Netrasemi cofounder Jyothis Indirabhai said the Centre’s ₹1.28 trillion incentive plan is welcome but incomplete. “Today, the government is supporting us on the science and development side. But once we reach commercialization, we need market advantages as well,” he told Mint. Semicon India 2026 is the annual semiconductor conference.
The startup, incubated in Kerala’s TrEST Research Park, has raised ₹125 crore and launched its first chip targeting drones, cameras, and robotics. It is in talks with over 20 companies, including major original equipment makers (OEMs) in India and Japan. Yet Indirabhai insists procurement policies are essential to give chips from India a foothold in government-linked sectors such as surveillance and telecom.
Industry stakeholders echo this view. India Electronics and Semiconductor Association (Iesa) president Ashok Chandak said pilot projects could validate domestic chips, while Gartner’s Kanishka Chauhan suggested tender reforms to favour local vendors.
“The missing piece is a procurement mechanism, which gives electronics makers some advantage when they use Indian-designed chips in products that are in turn supplied to the government, such as surveillance cameras,” Indirabhai said.
“For now, localization requirements in devices such as security cameras are met through assembly and other components, where key parts such as chips are procured from firms. Indian chipmakers, as a result, do not benefit from this as of now—this is what we would want to see changes in,” he added.
Industry supports procurement reform
Meanwhile, government stakeholders are willing to serve as an anchor customer for Indian chips. On 18 August, a senior Meity official told Mint that while a formal local procurement policy is not in place, national security-linked actions could help create a market for indigenous such as Netrasemi, in sectors such as telecommunications.
“There will be national security requirements in non-licensed fields in various strategic areas—all of these can boost the creation of a market for Indian chip companies,” the official had said.
Netrasemi, a domestic chip design incubated in August 2020 in Kerala’s government-funded TrEST Research Park, is one of India’s most-funded private semiconductor design startups. The entity has so far raised funds from India’s Zoho Corp and Unicorn India Ventures.
Indirabhai told Mint that the startup has so far raised ₹125 crore—of which “one-fourth has been spent on development.” In May this year, the startup launched its first chip, targeting clients in drones, security cameras, robotics, and automation.
While he did not offer a revenue projection, the executive said that Netrasemi is in talks with more than 20 companies, including four to five major OEMs, three of them in India and two overseas, with significant volume potential. It is also working with three early partners across the automotive and surveillance sectors, including a tier II automotive company in Japan.
Netrasemi reported ₹1.66 crore in revenue in FY25, its latest available financials, as accessed by Mint via business intelligence platform, Tofler.
Industry stakeholders backed Indirabhai’s claims, seeking the Centre’s presence as a customer.
Ashok Chandak, president of industry body India Electronics and Semiconductor Association (Iesa), said that “a clear guidance to government departments to encourage domestic semiconductor products can help aggregate demand and give companies, particularly startups, the opportunity to validate their products through pilot projects and field trials.”
Kanishka Chauhan, senior principal analyst at the global research and advisory firm Gartner, said that a key factor for the Centre to consider is revising the structure of tenders to favour local chip sourcing.
“Government contracts typically favour the lowest cost bidder, which could be reevaluated to favour local vendors. Domestic products meeting all technical requirements could be offered a 10-20% evaluation price preference. However, the end product must still satisfy all performance, security, and specifications,” he said.