Key Points
- India could double semiconductor market to $103 billion by 2030 from $52 billion in 2024
- ISM and DLI schemes attract ₹1.6 trillion in private investment across ten projects
- Country employs 150,000 chip design engineers but accounts for under 0.5 per cent of global fabrication
India’s semiconductor market could double to $103 billion by 2030 from $52 billion in 2024, driven by policy incentives, private investment and rising domestic demand, according to a new industry report released this week.
The report, titled India’s Semiconductor Moment and published by Bengaluru-based venture capital firm Endiya Partners, said the country is positioning itself to expand beyond chip design into large-scale manufacturing as global supply chains diversify away from East Asia. Artificial intelligence infrastructure, electric mobility, defence requirements and next-generation telecom networks are identified as the primary demand drivers.
The India Semiconductor Mission (ISM), a government programme to build domestic chip manufacturing capability, and the Design Linked Incentive (DLI) scheme have together attracted approximately ₹1.6 trillion in private investment across ten approved projects, according to the report. The ISM covers up to half of project costs, while state governments provide an additional 20 to 25 per cent in support through land, utilities and tax concessions.
Approved projects include Tata’s fabrication plant in Gujarat, built in partnership with Taiwan’s Powerchip Semiconductor Manufacturing Corporation (PSMC), Micron’s assembly and testing facility, and joint ventures between Tower Semiconductor and Adani Group in Maharashtra, and Tata’s TSAT project in Assam. A fabrication plant, or fab, is a factory that manufactures integrated circuits on silicon wafers using specialised equipment and cleanroom environments. These investments are expected to create capacity for approximately 90 million chips per day when fully operational.
Semiconductor design strength
On the design side, the DLI scheme has approved ₹803 crore for 23 projects, supported 278 institutions with access to chip design software tools and funded 72 startups, the report said. Government training programmes such as Chips-to-Startup and SMART Labs are expected to produce more than 100,000 engineers with skills in design and process technology over the coming years.
India currently employs around 150,000 semiconductor design engineers, representing approximately one-fifth of the global design workforce. Major international chipmakers including Intel, AMD, Qualcomm, NXP and Texas Instruments operate large design centres in the country. AMD’s Bengaluru facility is the company’s largest globally and is expected to reach 3,000 engineers by 2028, according to the report.
However, the country accounts for less than 0.5 per cent of global chip fabrication, the process by which integrated circuits are manufactured on silicon wafers. The report identified this gap between design capability and manufacturing capacity as India’s primary challenge, along with shortfalls in assembly and packaging infrastructure and a projected shortage of up to 13,000 skilled manufacturing professionals by 2027.
Global competition
India’s semiconductor push comes as governments worldwide seek to reduce dependence on East Asian chip production. Taiwan currently produces approximately 60 per cent of the world’s advanced semiconductors, meaning chips built using the most cutting-edge manufacturing processes below seven nanometres. The United States and European Union are spending heavily to develop local manufacturing alternatives.
China is expanding capacity in mature nodes, meaning older chip designs above 28 nanometres that remain essential for automotive, industrial and consumer electronics applications. The country could reach a 39 per cent share in that segment by 2027, according to the report. The United States’ CHIPS and Science Act and the European Chips Act have together mobilised more than $550 billion in public and private investment.
The report said India’s potential advantage lies in its design workforce, democratic governance and domestic demand, positioning it as what the authors described as a trusted partner in reshaped global supply chains.
Electric vehicle sales in India reached 1.97 million units in 2024, up 27 per cent from the previous year. Semiconductor content per vehicle is expected to rise from $312 for petrol models to more than $600 for electric ones, as battery management systems, motor controllers and advanced driver assistance features require more chips per unit.
By the numbers
Key figures from this story- $103B
- Projected India semiconductor market size by 2030
- ₹1.6 trillion
- Private investment in ISM and DLI approved projects
- 150,000
- Semiconductor design engineers employed in India
India completed its 5G rollout in 2024, covering nearly all districts with over 460,000 base stations. Research on 6G networks is under way through the Bharat 6G Alliance, which is expected to generate demand for terahertz frequency chips and AI-based network processors.
Defence spending rose 9.5 per cent in the 2025-26 budget to ₹6.81 trillion. The India-US National Security Fab, launched in 2024, focuses on infrared and gallium nitride semiconductors for strategic and energy applications. Gallium nitride is a compound semiconductor material used in high-power and high-frequency applications including radar systems and satellite communications.
Startup ecosystem
India now has more than 100 semiconductor startups spanning design, AI chips and power electronics, the report said. Venture funding rose from $5 million in 2023 to $28 million in 2024. Startups such as Netrasemi, Mindgrove and InCore are developing edge AI processors and architectures based on RISC-V, an open-source instruction set that allows companies to design custom chips without paying licence fees to established chip designers. Others, including Agnit and Maieutic Semiconductors, are targeting defence and industrial markets.
The India Deep Tech Investment Alliance has pledged $1 billion over the next decade for early-stage semiconductor ventures. However, only seven of 59 applicants under the DLI scheme received full approval, highlighting the technical and capital barriers to chipmaking.
The report said manufacturing growth depends on improving power, water and logistics reliability. A single semiconductor fabrication plant can use 8.9 million gallons of water per day and require 169 megawatt hours of electricity annually, according to the report. India’s logistics costs remain high, equivalent to approximately 14 per cent of GDP.
The report called for broader training programmes to develop talent across design, process engineering and business functions, and for long-term partnerships with the United States, Japan, Taiwan and the European Union. NXP plans to double its Indian workforce to over 6,000 engineers. Micron’s testing and packaging facility in Gujarat is expected to begin operations in 2025.
The report identified five priorities for the next five years: reliable infrastructure, expanded technical training, global partnerships, scaling startups into product companies, and building collaborative platforms across the semiconductor value chain.
Your Questions, Answered
How large could India's semiconductor market become by 2030?
According to the Endiya Partners report, India's semiconductor market could double to $103 billion by 2030 from $52 billion in 2024, driven by demand from AI infrastructure, electric mobility, defence and telecom sectors.
How much investment has the India Semiconductor Mission attracted?
The India Semiconductor Mission and Design Linked Incentive scheme have together attracted approximately ₹1.6 trillion in private investment across ten approved projects, with the government covering up to half of project costs.
What is India's current position in global semiconductor manufacturing?
India employs around 150,000 semiconductor design engineers, representing one-fifth of the global design workforce. However, the country accounts for less than 0.5 per cent of global chip fabrication.
What are the main barriers to India's semiconductor manufacturing growth?
The report identifies infrastructure challenges including high water and power requirements for fabs, logistics costs at 14 per cent of GDP, and a projected shortage of up to 13,000 skilled manufacturing professionals by 2027.
