India Semiconductor Market 2029 Size & Forecast Report | Industry Growth & Trends

Introduction

According to the TechSci Research report, “India Semiconductor Market - By Region, Competition Forecast & Opportunities, 2019-2029.”  India Semiconductor Market was valued at USD 34.4 billion in 2023 and is anticipated to project robust growth in the forecast period with a CAGR of 19.01% owing to the rising needs for electronics products by consumers, growing usage of artificial intelligence (AI), supportive government initiatives, etc. across the nation.

India’s unique demographic advantage, coupled with its expanding design ecosystem, manufacturing push, and strategic policy support, makes the market ripe for expansion. With over 120 semiconductor design units, the country is already a global leader in chip design services. However, the coming years are expected to focus on strengthening domestic manufacturing, building supply chain resilience, and fostering innovation in emerging application areas such as electric mobility, smart cities, 5G infrastructure, and industrial automation.

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Industry Key Highlights

• Market Value: USD 34.4 billion in 2023, projected to surpass USD 100 billion by 2029.

• Growth Rate: CAGR of 19.01% during 2024–2029.

• Key Drivers: Increasing consumer electronics demand, rapid adoption of AI and IoT, government incentives for semiconductor manufacturing, and digital transformation across industries.

• Major Applications: Automotive, IT & telecom, consumer electronics, industrial automation, and healthcare.

• Government Push: Production Linked Incentive (PLI) schemes, investments in semiconductor fabs, and education initiatives to strengthen chip design and manufacturing capabilities.

• Regional Growth: South India and Western regions lead in semiconductor design and IT services, while Northern and Eastern regions show rising demand due to industrialization and urbanization.

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Market Dynamics

Key Drivers

1. Growing Consumer Electronics Demand

India spends nearly USD 180 billion annually on electronic goods, making it one of the largest electronics markets globally. Smartphones, wearables, laptops, smart TVs, and IoT-enabled devices have created a vast consumer base that heavily depends on semiconductors. With increasing disposable incomes and digital adoption, this demand is expected to grow significantly.

2. Government Initiatives and Policy Support

The Indian government is aggressively pursuing strategies to build a domestic semiconductor ecosystem. Initiatives such as the PLI scheme for semiconductors and display manufacturing, support for electronics manufacturing clusters, and investments in education and research infrastructure are paving the way for India to reduce import dependence.

3. Rise of Artificial Intelligence and IoT

AI, IoT, and machine learning applications are driving demand for advanced semiconductor devices that can handle large-scale data processing, connectivity, and automation. Sectors like smart homes, industrial automation, predictive maintenance, and healthcare monitoring rely on semiconductor innovation.

Emerging Trends

1. Semiconductors in Electric Mobility

Electric vehicles are reshaping India’s mobility landscape. EVs require sophisticated chips for battery management systems, power electronics, and safety systems. As India’s EV ecosystem expands, semiconductor demand from this segment will grow exponentially.

2. Growth of Fabless Design Companies

While India currently lacks large-scale semiconductor fabrication facilities, it has become a global hub for design. The rise of fabless companies—focusing on chip design while outsourcing manufacturing—is creating opportunities for startups and established firms alike.

3. AI and Machine Learning Acceleration

Edge AI chips, AI accelerators, and specialized processors are gaining traction in India to support cloud services, robotics, and automation. The future demand for customized AI chips will boost local R&D investment.

4. 5G and Telecom Expansion

The rollout of 5G infrastructure is a key growth catalyst. Semiconductors are critical for base stations, mobile devices, and communication equipment. As India builds its digital highways, the demand for high-performance chips will multiply.

5. Supply Chain Localization

Global semiconductor shortages during the pandemic highlighted India’s vulnerability to imports. The emphasis now is on local manufacturing and resilient supply chains, supported by government and private sector investment.

Application Analysis

Automotive Sector: Dominant Force

The automotive sector has emerged as the leading consumer of semiconductors in India. Chips are vital for advanced driver assistance systems (ADAS), electric drivetrains, safety sensors, navigation systems, and infotainment units. The surge in EV adoption has particularly accelerated demand for power electronics and battery-related semiconductor solutions.

Government initiatives such as subsidies for EV buyers, charging infrastructure development, and domestic EV production incentives have further strengthened this sector’s semiconductor demand.

IT & Telecom Sector

With India being a global IT hub, the semiconductor market benefits significantly from the expansion of telecom services, cloud computing, and data centers. The transition to 5G technology requires a massive increase in semiconductor deployment for networking equipment, smartphones, and IoT devices.

Consumer Electronics

Smartphones, wearables, and home automation devices are fueling semiconductor demand. India’s growing middle class, combined with increasing internet penetration, ensures steady growth in this application segment.

Industrial Applications

Industrial automation, robotics, and predictive maintenance are becoming mainstream. Semiconductors are the backbone of these solutions, enabling efficiency, real-time monitoring, and predictive analytics across sectors such as manufacturing, logistics, and healthcare.

Key market players in the India Semiconductor Market include:

• Broadcom Inc.
• CHIPLOGIC TECHNOLOGIES
• Tata Elxsi Limited
• Continental Device India Pvt. Ltd., (CDIL)
• MosChip Technologies Limited
• NXP B.V.
• ASM Technologies Limited
• Masamb Electronics Systems Private Limited
• Semi-Conductor Laboratory
• ROHM Co., Ltd. 

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Future Outlook

The outlook for India’s semiconductor industry is promising, underpinned by strong demand, policy support, and technological innovation. Key future drivers include:

1. Domestic Manufacturing Push – The establishment of India’s first large-scale semiconductor fabs will mark a turning point, reducing import reliance and creating a self-sufficient ecosystem.

2. Electric Vehicle Expansion – As EV adoption accelerates, automotive semiconductor demand will surge, creating opportunities for innovation and local production.

3. Digital Infrastructure Growth – The expansion of data centers, cloud services, and 5G infrastructure will remain core demand drivers.

4. AI and Smart Technologies – Increased integration of AI in everyday devices will further stimulate specialized semiconductor development.

5. Global Competitiveness – India’s ability to become a competitive semiconductor hub will depend on sustained investments, skilled workforce development, and global collaborations.

By 2029, India is poised to not only emerge as one of the fastest-growing semiconductor markets but also to establish itself as a critical player in the global semiconductor supply chain.

Conclusion

The India Semiconductor Market is entering a transformative phase, driven by a convergence of factors—rising demand for electronic goods, government-backed initiatives, and the country’s strong design ecosystem. With applications ranging from automotive and telecom to consumer electronics and industrial automation, semiconductors will play a defining role in India’s technological future.

As the industry evolves, opportunities for innovation, investment, and collaboration will grow exponentially. The creation of a robust domestic ecosystem—spanning design, R&D, manufacturing, and supply chain infrastructure—will be key to achieving self-reliance and global competitiveness. The next decade is likely to witness India not just as a consumer of semiconductors but as a global hub for design, manufacturing, and innovation in this critical industry.

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