India’s Semiconductor Market Poised for Remarkable Growth
By Bhagwat | April 12, 2025
India’s semiconductor industry is on the cusp of significant expansion, with revenues projected to double from $54 billion in 2025 to $108 billion by 2030, according to a recent report by UBS. This growth represents a compound annual growth rate (CAGR) of 15%, surpassing global averages.
Key Drivers of Growth
Several factors contribute to this optimistic outlook:
- Demographics and Digitalization: India’s favorable demographics and increasing digital adoption are driving up demand for electronic devices, thereby boosting semiconductor consumption.
- Government Initiatives: Supportive government policies, including the India Semiconductor Mission (ISM), aim to establish a self-sustaining chip ecosystem, attracting investments and fostering innovation.
- Global Supply Chain Shifts: Major tech companies are diversifying their supply chains, with some adopting a “China plus one” strategy, positioning India as a viable alternative manufacturing hub.
Market Potential
Despite accounting for only 0.1% of global wafer capacity, India holds a 6.5% share of the semiconductor end-demand market. The localization of semiconductor manufacturing is expected to generate approximately $13 billion in revenues by 2030.
Strategic Investments
Significant investments are underway to bolster India’s semiconductor infrastructure:
- Fabrication Plants: Collaborations such as Tata Electronics and Taiwan’s PSMC are establishing a $10.9 billion fabrication plant in Gujarat, with production anticipated by late 2026.
- Assembly and Testing: Facilities like Tata Semiconductor Assembly and Test (TSAT) in Assam and partnerships involving CG Power and Renesas Electronics are enhancing assembly, testing, marking, and packaging capabilities.
Talent and Expertise
India’s robust software and services sector complements its semiconductor ambitions, with approximately 20% of global chip designers employed by multinational corporations in the country.
Challenges Ahead
While the prospects are promising, challenges such as infrastructure requirements, capital intensity, and talent acquisition for fabrication units remain. Addressing these will be crucial for sustaining growth and achieving the projected market size.
In summary, India’s semiconductor market is on a trajectory of rapid growth, supported by strategic investments, favorable demographics, and proactive government policies, positioning the country as a significant player in the global semiconductor landscape by 2030.
Source “TOI“
