India’s semiconductor market is projected to exceed $150 billion by 2030, with artificial intelligence (AI) semiconductors alone representing a $21 billion opportunity, according to a report by Basic Roots Consulting.
The increasing demand for electronics and semiconductors in the country is driven by rising incomes, growing digital adoption, and a large domestic market expected to reach $110 billion by FY30.
The report notes that two-thirds of India’s semiconductor startups operate out of Bengaluru, with the central government expected to cover half the cost of semiconductor manufacturing setup. Currently, India has over 100 semiconductor startups, contributing 20% of the global semiconductor integrated circuit design workforce, with the sector experiencing 2.4x growth since 2014.
India has attracted $18 billion in investments across five semiconductor projects, with a strong focus on Outsourced Semiconductor Assembly and Testing (OSAT) and Assembly, Testing, Marking, and Packaging (ATMP) services. Companies like Tata, Micron, and Keynes are leading investments in advanced chip packaging and testing, driving further growth in this ecosystem.
The government’s Semicon India program, with an allocation of ₹76,000 crore, aims to support companies investing in semiconductor manufacturing, design, and display technologies. This initiative is a key step in bolstering India’s position in the global electronics value chains.
However, challenges persist, including the absence of advanced semiconductor fabs, heavy reliance on imports for materials like wafers and specialty chemicals, and significant capital investment requirements. India’s semiconductor space continues to be dominated by foreign companies such as TSMC and Samsung.
The India Semiconductor Mission (ISM), established as an independent division within Digital India Corporation, is focused on long-term strategies to enhance semiconductor design and manufacturing in the country. Overcoming these challenges will be essential for India to strengthen its presence in the global semiconductor industry.
