Semiconductor
India’s semiconductor industry is entering a new phase. Supported by the India Semiconductor Mission (ISM), significant public investment and rising demand from the electronics, automotive and industrial sectors, the country is expanding capabilities across fabrication, Assembly, Testing, Marking and Packaging (ATMP), compound semiconductors and the broader supply chain.
/ Overview of India's Semiconductor Sector
Global demand for artificial intelligence (AI), electric vehicles (EVs), advanced electronics and data centres is driving semiconductor industry growth, while geopolitical tensions are prompting diversification beyond traditional hubs. India has long been a global centre for semiconductor design, supported by its large engineering talent pool, and is now extending that strength into manufacturing through initiatives such as ISM, which supports compound semiconductors and related industries.
While the ecosystem is still developing, India’s growing manufacturing base, policy support and engineering capabilities are creating new opportunities across the semiconductor value chain.
$110 bn
Projected size of India's domestic market by 2030
6+
Semiconductor Clusters
12
Approved ISM Projects
$13.3bn
ISM 2.0 Outlay
/ Growth Drivers
Expanding Electronics Manufacturing: PLI schemes and rising domestic and export demand for smartphones, electronics and telecom equipment are strengthening the case for local chip manufacturing.
Automotive & Industrial Demand: Growth in EVs, Advanced Driver Assistance Systems (ADAS), and industrial automation is boosting demand for mature-node chips and power semiconductors.
Global Supply Chain Diversification: Geopolitical disruptions are pushing companies to consider India as part of diversified semiconductor strategies.
Policy Support: ISM-led initiatives are accelerating investment across fabrication, ATMP, compound semiconductors and design, alongside broader ecosystem development.
/ Key Investment Opportunities
Design & Technology
∕ India’s strongest semiconductor capability lies in chip design, EDA tools and semiconductor IP, supported by a large engineering talent pool. The country is now extending this strength towards domestic wafer fabrication.
- Chip Design
- EDA Tools
- Semiconductor IP Cores
- Wafer Fabrication
Opportunities for International Companies
∕ Assembly, Packaging & Testing: Expanding ATMP/OSAT capacity is creating demand for packaging technologies, testing solutions, specialised equipment and technical expertise.
∕ Equipment & Automation: New semiconductor facilities require process equipment, inspection systems, automation, process-control technologies and maintenance services.
∕ Specialty Materials & Consumables: Growing production capacity is driving demand for high-purity chemicals, industrial gases, wafers, packaging materials and other specialised inputs.
∕ Cleanroom & Industrial Infrastructure: Semiconductor facilities require specialised cleanrooms, HVAC, ultra-pure water systems and contamination-control solutions.
∕ EDA, IP & Engineering Services: India’s established design ecosystem supports demand for EDA tools, semiconductor IP, chip design and specialised engineering services.
Manufacturing & Applications
∕ India is rapidly building capabilities in assembly, packaging, testing and semiconductor integration, creating opportunities across equipment, materials, distribution and end-use industries.
- Assembly, Packaging & Testing (OSAT/ATMP)
- Distribution & OEM Integration
- End-Product Applications
Regulatory & Incentive Landscape
∕ India Semiconductor Mission (ISM): Provides financial and policy support for fabrication, ATMP, display and compound semiconductors. ISM 2.0, approved in 2026, increased the programme outlay to ₹1.275 lakh crore and expanded policy support across equipment and materials, fabrication facilities, ATMP/OSAT, design, R&D and talent development.
∕Design Linked Incentive (DLI) Scheme: Supports domestic design companies and startups with funding, EDA tool access, and commercialisation support.
∕State-Level Support: Gujarat, Uttar Pradesh, Assam, Odisha, Tamil Nadu and other states have introduced semiconductor and electronics policies offering varying combinations of capital incentives, land and infrastructure support, and streamlined approvals.
/ Key Investment Clusters
|
Cluster |
Focus |
Highlights |
|
Gujarat |
Fabrication, ATMP & OSAT |
Tata-PSMC fab in Dholera; Micron, Kaynes Semicon, CG Semi in Sanand – India’s leading hub |
|
Assam |
ATMP |
Tata Electronics facility in Jagiroad |
|
Uttar Pradesh |
Display Driver ICs |
HCL-Foxconn JV near Jewar |
|
Odisha |
Compound Semiconductors |
Emerging SiC and advanced packaging hub |
|
Rajasthan |
Packaging |
Sahasra Semiconductor, India’s first SME-led facility |
|
Bengaluru, Hyderabad, Chennai |
Design & R&D |
Leading design/engineering centres |
/ How We Can Help
Foreign businesses seeking to enter or expand in India’s semiconductor market can benefit from:
NEWS & UPDATES
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