Ajit Manocha reflects on the trajectory of the semiconductor industry and India’s role in shaping its future. India’s ambitions in the semiconductor space are driven by the vision to create a globally competitive and resilient ecosystem by 2030. As semiconductors power vital innovations across industries—from smartphones to electric vehicles—the country is positioning itself as a critical player in the global market, with the support of government initiatives like the India Semiconductor Mission (ISM).
A significant boost came from local demand for respective chips and a quick push made by the government to achieve self-reliance. The India Semiconductor Mission under India's Ministry of Electronics and Information Technology (MeitY) has been the catalyst behind promoting semiconductor design, manufacturing, and innovation. India semiconductor industry has a market size prediction of $64 billion by 2026 with application from such giants as Applied Materials, Cadence, Micron, and Synopsys.
Strategic Advantages for Growth
India’s semiconductor sector benefits from several key strategic advantages that enhance its competitiveness. The country’s cost-effective labor force and large consumer base make it an attractive destination for semiconductor manufacturing. Government incentives, including the $10 billion initiative under the India Semiconductor Mission, further fuel this momentum. Additionally, India’s expanding demand for electronic devices, from smartphones to Internet of Things (IoT) devices, accelerates the need for advanced semiconductors.
Policy support and global partnerships play a pivotal role in shaping India’s semiconductor future. Through collaborations with key economies like the U.S., Japan, Taiwan, and Singapore, India is enhancing its technological capabilities and positioning itself as a strong player in the semiconductor race.
Key Challenges and Developments
Despite the advantages, India faces several challenges in its semiconductor ambitions. A lack of robust manufacturing infrastructure and a complex supply chain dependent on imports are the main hurdles. However, India is working to overcome these issues, and the Tata Electronics fab in Gujarat is a significant development in the country's semiconductor manufacturing infrastructure. The event also marks the first edition of SEMICON India 2024, where global companies and stakeholders have gathered, indicating a developing semiconductor ecosystem in the country.
Another challenge is the talent and skills gap. While India boasts a large pool of engineering talent, specialized expertise in semiconductor manufacturing is still lacking. Bridging this gap requires tailored educational programs and industry-specific training to develop the workforce necessary for high-tech manufacturing. The efforts by organizations like SEMI, focused on workforce development, will be critical in this process.
Furthermore, India’s entry into the semiconductor industry coincides with fierce competition from established players like Taiwan, South Korea, and China. To compete effectively, India will need to leverage its policy framework, strategic partnerships, and technological collaborations to catch up to these global leaders.
Recent Trends and Future Outlook
The semiconductor industry is expanding at a rapid global scale, and the number of new fab construction projects is likely to rise in the coming years. By 2027, more than 100 new fabs are likely to come up globally, with the rising demand for semiconductors in AI and high-performance computing being the most important drivers. India is in an excellent position to cash in on this boom as increasing demand for semiconductors in AI, 5G/6G technologies, electric vehicles (EVs), and IoT is driving growth.
India’s focus on localizing its semiconductor supply chain and developing advanced manufacturing capabilities will be crucial in reducing reliance on imports and building resilience against global disruptions. Additionally, the country is poised to embrace cutting-edge manufacturing techniques, such as the transition to smaller node sizes (7nm and below), which are reshaping global industry standards. Strategic collaborations with global technology leaders will also enhance India’s capabilities in AI and IoT, positioning the country as a key player in next-generation technologies.
Semiconductors in 2025 and Beyond
India’s semiconductor journey is not just about meeting domestic demand but also establishing itself as a major player on the global stage. The country’s vision for 2030 includes the establishment of multiple fabrication units, an emphasis on research and development, and a skilled workforce to drive innovation. With continued support from the government, collaboration with global tech giants, and strategic alignment with emerging technologies, India is set to play a central role in the global semiconductor value chain.
The next decade will be crucial in determining India’s place in the semiconductor industry. As the country builds momentum, the focus on localization, innovation, and strengthening global partnerships will drive its transformation into a semiconductor powerhouse. With significant opportunities ahead, India’s semiconductor sector is poised to play a central role in the global technological revolution.
Conclusion
India's semiconductor dreams are on an ambitious trajectory towards becoming a world leader in the manufacture and innovation of semiconductors. With a very clear vision for a resilient and competitive ecosystem by 2030, the country is laying a foundation for the future where it will play a critical role in powering global technological advancement. While challenges such as infrastructure gaps, skill shortages, and fierce global competition remain, India’s strategic advantages—cost competitiveness, a large consumer base, government support, and global partnerships—provide a solid foundation for success.
The continued progress of initiatives like the India Semiconductor Mission (ISM), the development of semiconductor fabrication facilities, and growing collaborations with global technology leaders signal a promising trajectory. As India accelerates its efforts to localize supply chains, adopt advanced manufacturing techniques, and tap into the booming demand for AI, IoT, and next-gen technologies, it is poised to make significant strides in the semiconductor space.
With the right investments in infrastructure, talent development, and international partnerships, India has the potential to not only meet domestic demand but also become a key player in the global semiconductor ecosystem. The next decade will be a defining period, shaping India’s position as a leader in the global technological revolution and setting the stage for its semiconductor success.
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