Indian Chip Startups Focus on Local AI Processors for Everyday Devices

Homegrown Indian startups are developing specialised artificial intelligence chips for cameras, cars, and other everyday electronic devices to run AI locally without needing the internet or cloud.

Chip Development

Pratik Parmar of the startup Atomo showed a circuit board at the Semicon India 2026 conference that lets cameras and machines spot fires, track people, and find factory defects locally. Atomo currently uses a US-designed Amlogic chip because Indian alternatives were not ready when it chose one three years ago. However, a nascent Indian industry has emerged as firms move their first products into customer testing and commercialisation. Under a government chip-design programme, 105 startups and small businesses have gained access to advanced design tools and produced about 35 chip designs ready for manufacturing.

Market Strategy

While India missed the race to design chips for AI data centres, industry leaders say the country can compete in putting intelligence into cameras, vehicles, and electronics instead of building the world's fastest processor. Ashok Chandak, president of SEMI India and the India Electronics and Semiconductor Association, noted that software, scale, and customer adoption remain the real tests. India's semiconductor market is expected to grow from US$64 billion in 2026 to US$200 billion by 2035, with consumer electronics, automobiles, and industrial applications driving demand. Atomo has sent circuit boards for testing in Japan, South Korea, and the Middle East.

Industry Growth

Local AI processing allows devices to respond faster and work when internet connectivity fails, which is useful in India's cost-sensitive market. G S Madhusudan, CEO of InCore Semiconductors, said this local intelligence is spreading across cars, cameras, televisions, and industrial equipment. Sunil Kumar of startup BigEndian Semiconductors, which is developing an AI-enabled processor for surveillance cameras, stated that smaller companies can customise hardware and software for specific markets rather than compete on raw computing power. Kumar also pointed to India's scale as a testing ground, citing crowd management at the Kumbh Mela pilgrimage. India hosts about 20 per cent of the world's semiconductor design engineers, according to Invest India CEO and former Intel India head Nivruti Rai. Meanwhile, Indian edge AI chip startups raised US$17 million in 2026, up from US$4.27 million in 2022 and virtually nothing before 2020, according to Tracxn.

Context

Edge AI chips process information directly on local hardware rather than sending data back and forth to distant data centres. This approach helps maintain data privacy, lowers cloud service expenses, and ensures that critical safety systems keep operating even if network connections drop.