Introduction
India’s semiconductor industry is on the brink of a transformative journey, with projections indicating the market will exceed $100 billion by 2030.
Spearheaded by the Indian government’s strategic initiatives and robust engineering talent, this growth underscores India’s potential to become a global semiconductor hub.
Union Minister of State for Information Technology, Jitin Prasada, recently highlighted these developments in Parliament, outlining the key measures driving this ambitious growth.
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Government Initiatives Driving Growth
India’s semiconductor market is projected to surpass $100 billion in valuation by 2030, as per Union Minister of State for Information Technology, Jitin Prasada.
Speaking in Parliament on Wednesday, Prasada highlighted several government initiatives that will contribute to this growth, including production-linked incentive (PLI) schemes and the design-linked incentive (DLI) scheme aimed at boosting local chip design.
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Key Government Schemes
The government’s strategy to propel the semiconductor market includes:
- PLI Schemes: These incentives support the establishment of chip fabrication plants (fabs), display fabs, and chip testing and packaging plants.
- DLI Scheme: This initiative focuses on encouraging local chip design to enhance India’s semiconductor design capabilities.
- Promotion of Local Manufacturing: Efforts are being made to increase the domestic production of components and large-scale electronics.
Modernizing Infrastructure
Efforts to modernize the Centre-owned Semi-Conductor Laboratory in Mohali are underway, which will further contribute to reaching the $100 billion milestone.
Market Growth Projections
Prasada revealed that India’s semiconductor market, valued at $38 billion in 2023, is expected to grow to $109 billion by 2030.
This growth represents a 16% compounded annual growth rate (CAGR). A significant contributor to this growth will be the semiconductor fab being set up by Tata Electronics in partnership with Taiwan’s Powerchip Semiconductor Manufacturing Corporation (PSMC) in Dholera, Gujarat.
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Tata-PSMC Semiconductor Fab
The Tata-PSMC semiconductor fab will start operations in 2027. It will involve a $10.9 billion investment, including incentives from the central and state governments.
The facility will produce 3 billion chips annually, with die sizes of 28nm, 50nm, 55nm, and 90nm.
These chips will support industrial applications such as railways, electric vehicles, and consumer electronics.
Micron’s ATMP Facility
Adding to the value chain are assembly, testing, marking, and packaging (ATMP) facilities.US-based Micron announced an ATMP facility in 2022.
The investment amounts to $2.75 billion. This made Micron the first benefactor of the Centre’s PLI push.
India’s Robust Chip Design Sector
India already has a strong chip design industry. On Tuesday, Qualcomm announced a new mobile processing platform designed for budget-range smartphones in India.Chris Patrick, senior vice-president at Qualcomm, said many of their modems and chips come from India.
“With 15,000 engineers, India is likely our largest design base,” he stated.
“It may be just behind our San Diego headquarters,” he added.
“We go where there is talent, and India excels in the semiconductor ecosystem,” Patrick said.
AMD’s Expansion in India
In July last year, Advanced Micro Devices (AMD) announced a $400 million investment .
This will expand its chip research and development (R&D) operations in India. This makes India AMD’s biggest hub for semiconductor engineering globally.
Contributing to a $100 Billion Industry
Industry estimates suggest that India could account for nearly one-fifth of all chip design operations worldwide, thanks to the availability of domestic engineering talent.
This talent pool has attracted many leading companies to expand their operations in India, contributing significantly to the projected $100 billion industry valuation.
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Conclusion
India’s semiconductor market is on a trajectory to achieve remarkable growth by 2030. Government initiatives, significant investments from global tech companies, and the country’s robust engineering talent pool are driving this expansion.
As India continues to strengthen its semiconductor ecosystem, it positions itself as a key player in the global semiconductor industry.
