Gaming, GenAI, and Spacetech: India’s Surprising Deeptech Boom

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Sanvi Barjatya

14 Nov 2025 — 5 min read

Gaming, GenAI, and Spacetech: India’s Surprising Deeptech Boom - Mr. Kalyan Sivalenka, Managing Partner at Hyderabad Angel Fund (HAF)

This article has been contributed by Mr. Kalyan Sivalenka, Managing Partner at Hyderabad Angel Fund (HAF)

When people talk about Indian startups, they refer mostly to fintech, edtech, or SaaS. Still, there is one silent revolution that is turning heads across the world: gaming, generative AI, and Spacetech are slowly but surely emerging as the next big bets for deeptech in India. These are no longer buzzwords; they are real, fast-growing sectors with serious potential.

Gaming: From Timepass to Power Play

Gaming, once thought of as no more than a hobby in India, is no longer just that. Past year, the Indian online gaming market pulled in around US$ 3.7 billion in revenue. The number of gamers in India has been estimated at about 591 million in 2024. With more than 500 million mobile gamers and a market value expected to reach $8.6 billion by 2027, the industry is booming. What changed? For starters, Indian studios such as Stan, Nodding Heads (behind the hit game "Raji: An Ancient Epic"), and SuperGaming create original, culturally rich games that resonate globally.

Esports is also exploding, especially in Tier 2 and Tier 3 cities. Game streaming is now a career path, and new ways to make money—like in-app purchases and ad-supported models—are drawing in investors. Sure, there are still some regulatory grey areas, but the momentum is undeniable. There are still regulatory grey areas, but the momentum is undeniable. Investors are now treating gaming not just as entertainment but as a serious digital economy. Tier 2 and Tier 3 cities are becoming talent hubs, and gaming creators are building loyal audiences that brands are eager to tap into.

GenAI: India's Quiet AI Revolution

As the world watches big tech companies out West roll out flashy AI tools, India is quietly building its own GenAI ecosystem. Startups like Sarvam AI, Gan.ai, and GigaML are riding the hype by solving real-world problems-be it multilingual content creation, affordable legal tools, or AI-powered healthcare solutions.

It is here that India enjoys some natural advantages: a vast pool of technology talent, diversified languages, and availability of large datasets. Instead of building viral chatbots, Indian GenAI startups are building tools that help businesses run smarter and faster. According to a report by NASSCOM, India’s GenAI startup funding jumped to US$ 51 million in Q2 FY25 (from US$ 8 million in Q1). By the first half of 2025, cumulative funding for GenAI startups in India had reached about US$ 990 million. What we’re seeing is a shift from experimentation to deployment: more founders are building domain-specific, business-first AI tools for SMEs, MSMEs, HR/finance and operations.

As investors, we’re seeing founders who combine strong technical backgrounds with the patience to build sustainably something essential for deeptech success.

Spacetech: Shooting for the Stars

India’s space journey isn’t just about ISRO anymore. Post 2021, private companies are stepping up in a big way as govt opened up space. Skyroot Aerospace and Agnikul Cosmos are building their own rockets. Dhruva Space and Pixxel are working on satellites and earth observation tech. We also seen in stock market, few of the ISRO Vendors are doing well but unable to pick up the pace with startups which are really building a good equipment for space mission competing with US, Europe and China.

The government is helping too - with new policies, more foreign investment, and partnerships between public and private players.

In year 2024, India approved a INR 10 billion (~US$ 119 million) fund for space startups in October. However, private investment in the sector dropped in 2024: funding fell about 55% to US$ 59.1 million. For investors, this is not just about rockets—it’s about building a new infrastructure layer: manufacturing, data analytics, satellite services, climate monitoring. ISRO’s support and India’s cost-effective engineering are making the country a serious contender in the global space race.

Why Is This Happening Now?

India produces more than a million STEM graduates every year (As per various statictics produced in secondary market). Add this to lower costs, rising quality, and a growing appetite for innovation, and you have all the makings of a perfect storm for deeptech growth. Government programs like Startup India are also urging more entrepreneurs to bold, tech-heavy ideas.

In gaming, the base of 590 + million gamers shows huge scale. In GenAI, the startup count has grown markedly—India now ranks among the top global hubs for GenAI startup formation.

Plus, global investors are starting to look beyond Silicon Valley. They’re searching for high-potential, underexplored markets—and India is right in their sights. We have observed more than 50% of the students are taking daring step to enter entrepreneurship having a deep expertise and patient to grow considering their age.

What Needs to Happen Next?

If you remember recent remarks by Piyush Goel, Cabiner Minister in Startup mahakumbh has made many people and investors to think Deeptech investment deeply. We are aware, deeptech takes time. These aren’t quick wins—they’re long games. To really unlock India’s potential, we need:

More patient capital
Stronger IP protection
Deeptech-focused accelerators
Better collaboration between startups, universities, and defense R&D
Policy frameworks that reward sustained innovation and domestic manufacturing of core tech (chips, sensors, payloads).

Final Thoughts

India’s deeptech boom might seem unexpected—but it’s very real.

The next big Indian unicorn might not be a social app. It could be a powerful algorithm, a home-grown chip, or a satellite the size of a shoebox—and make India proud globally. India’s deep-tech boom may seem unexpected—but for those watching closely, it already feels inevitable. With the right mix of policy support, investor conviction and founder ambition, India’s next global success story will emerge from labs, not just boardrooms. The only question now is: who’s ready to go all in and lead the charge?