What’s Chipping In For India’s Chip Ecosystem

As geopolitical tensions intensify and technology rivalries fragment global supply chains, India’s ability to design, manufacture, and integrate semiconductors will be a decisive factor in shaping its future growth and securing strategic autonomy.

The global semiconductor market grew at a compounded annual growth rate (CAGR) of 6.5 per cent between 2014 and 2024 and is expected to grow at a slightly higher CAGR of 8.5 per cent2 over the next 5 to 10 years, underpinned by next-generation, technologyled growth drivers. Parallel to the global semiconductor industry’s rapid surge, India’s semiconductor demand is also on an accelerated growth path. It is projected to grow at a CAGR of 19 per cent, reaching around USD 90 billion by FY2030 and potentially expanding further to over USD 200 billion by FY2035 if this momentum continues, said NITI Aayog in its recently released report.

“India can build an end-to-end semiconductor value chain by playing to its foundational strengths in design and engineering. It starts with moving from world-class design to product and system architecture in India. Manufacturing can then scale pragmatically, focused on digital, analog, power, automotive, and advanced packaging, aligned to domestic and global demand. Underpinning all of this are deep ecosystem partnerships, sustained policy support, and talent built at scale,” Ms. Malini Narayanamoorthi, President, Renesas Electronics India and Vice President, Renesas Electronics.

Semiconductors are evolving from standalone components into tightly integrated systems that underpin the digital economy. Semiconductor is the unsung hero of the digital world. This structural shift presents a timely opportunity for India to leapfrog legacy stages and position itself as a competitive force across critical segments of the global semiconductor supply chain. To realise this opportunity, India needs to move beyond being a downstream consumer to becoming a co-creator of frontier technologies that will shape global compute leadership. This calls for building capabilities in design, advanced packaging and strategic manufacturing. 

Demand is moving beyond general-purpose chips toward specialised architectures, accompanied by a growing emphasis on advanced packaging, heterogeneous integration and system-level performance. 

“India holds nearly 20 per cent of the global talent in the fabless semiconductor space, an incredible strength. But to truly advance toward self-reliance, we must go beyond multinational GCCs and nurture homegrown startups that design indigenous chips. The shift from services to IP creation is already underway, and as momentum builds, it will give India a powerful strategic advantage in the global Fabless ecosystem,” said Anku Jain, MD, MediaTek India.

Semiconductors represent one of the most consequential industrial opportunities of the coming decade for India. Rising import dependence, strategic vulnerability and lost value creation, creates profound opportunities for India to grow. 

“Today, India imports most of its semiconductor raw materials from countries like Japan and Malaysia. But as we begin developing these materials domestically, the journey will take time. Encouragingly, we are not facing any major challenges at present, which gives us confidence in building a stronger, self-reliant supply chain for the future,” said Suraj Rengarajan, Principal Technologist, Applied Materials.

Building an indigenous semiconductor ecosystem is among the most critical industrial transformations of the coming decade. As global supply chains shift and advanced electronics define economic competitiveness, India faces a pivotal opportunity to evolve from a design execution hub into a nation with end-to-end semiconductor capabilities.

This transformation demands multi-stakeholder partnerships, cross-ministerial coordination, industry-academia collaboration, and a strong foundation in research and talent. Beyond strengthening domestic design, India must aim to own advanced IPs, pioneer next-generation architectures, and foster system-level innovation. At the same time, scaling domestic manufacturing, from mature nodes and compound semiconductors to advanced packaging, will reduce import dependence and build a resilient supply base for strategic sectors like telecom, automotive, defence, and clean energy.