India, July 11 -- Backed by rising investor interest and strong government support, AI and defence tech sectors are poised to emerge as the most sought-after sectors in India's startup ecosystem for the second half of 2025.

According to Inc42's latest investor survey, nearly 57% of the 80+ respondents are actively scouting for early stage AI investments, while another 22% are eyeing growth-stage bets in either AI or advanced hardware and technology - a category that includes most defence tech startups.

In H1 2025, Indian startups raised $5.7 Bn across 470 deals, up 8% from $5.3 Bn in H1 2024, according to Inc42's Indian Tech Startup Funding Report H1 2025.

While fintech and ecommerce continued to rule the sectoral funding trends on the...