India’s agriculture sector contributes around 16–18 per cent to the country’s GDP and supports nearly 42–45% of the workforce, making it one of the most critical pillars of the economy (Source:The International Fund for Agricultural Development (IFAD)).

Yet, despite its importance, this sector continues to struggle with low productivity, climate uncertainties, and inefficient resource utilization. What is changing today, is the increasing role of technology - particularly Artificial Intelligence (AI), drones, and data systems in transforming agriculture into a more precise and efficient sector.

AI is already beginning to influence farming practices in India. From crop yield prediction and pest detection to weather forecasting and farm advisory services, AI is enabling data-driven decision-making. According to NITI Aayog, the adoption of AI and advanced technologies could add $1.7 trillion to India’s economy by 2035. This highlights the scale of opportunity that lies ahead if technology adoption is accelerated.

Drone technology is also emerging as a key enabler in this transformation. With supportive policies such as Drone Rules 2021 and increasing adoption by startups, drones are being used for crop monitoring, spraying, mapping, and precision farming. The Indian drone market is projected to reach $11 billion by 2030, accounting for 12.2% of the global drone market, reflecting strong demand and innovation in the sector.

Backbone of modern tech

However, despite this visible progress, there is a critical gap that remains largely unaddressed - the lack of a strong domestic semiconductor ecosystem. Semiconductors are the backbone of all modern technologies. Every AI system, drone operation, sensor network, and smart farming solution ultimately depends on chips for processing and data handling.

India currently imports nearly 85–90% of its semiconductor requirements, as highlighted by the Ministry of Electronics and Information Technology. This heavy dependence creates a structural vulnerability, especially for startups building deep-tech solutions. Agri-tech startups developing AI platforms or drone technologies often rely on imported chipsets, increasing costs and limiting scalability.

Recognising this challenge, the government did launch the India Semiconductor Mission with a $10 billion incentive outlay to promote semiconductor manufacturing and design in India. While this is a significant step, the focus must also extend to nurturing semiconductor startups, particularly in chip design, embedded systems, and application-specific technologies tailored for sectors like agriculture.

The convergence of AI, drones, and semiconductors is where the future of agriculture will be shaped. AI provides intelligence, drones enable real-time data collection, but semiconductors power both these systems. Without this foundational layer, the agri-tech ecosystem risks remaining dependent and fragmented.

Defined by technology

Startups will play a defining role in bridging this gap. India has already built a strong base in AI and drone innovation. The next phase must focus on building a robust semiconductor startup ecosystem that can support these technologies. This requires long-term investment, policy support, and strong collaboration between academia, industry, and government.

As an incubator working closely with startups, we are witnessing this need at ground level. Through initiatives under Startup Stairs, ₹4 crore has been committed in investment to support startups in AI, drone, and semiconductor domains. Through the startup league and incubation programs, the aim is not just to provide funding, but also to enable mentorship, infrastructure, and market access which is very critical for scaling deep-tech innovations in India.

India’s agricultural future will not be defined by land alone, but by the technologies that enhance it. The transition towards intelligent, data-driven farming is inevitable. However, for this transformation to be sustainable and self-reliant, India must strengthen its semiconductor backbone.

The real missing link in agri-tech is not innovation - it is integration. And at the center of that integration lies one critical element: semiconductors.

The author is AVPL International & Promoter, Startup Stairs

Published on May 2, 2026