New Delhi: India’s semiconductor market is expected to grow to about $120 billion by 2030, driven by a significant adoption of artificial intelligence, states a new report by Deloitte.
“Driven by the exponential AI adoption (resulting in capital expansion and increasing digitalisation), India’s semiconductor market is projected to reach US$120 billion by 2030 and US$300 billion by 2035, reflecting a CAGR (compound annual growth rate) of 20%,” the report, titled ‘Technology, Media, and Telecommunications Predictions 2026’, states.
It added, “By 2035, mobile phones, automotive, computing and data centres are expected to account for more than 70% of the total semiconductor demand in India.”
The findings, released Wednesday, also show that India, which currently imports nearly 90 per cent of its semiconductor needs, is now preparing for a structural shift, emphasising local production. The Indian semiconductor production ecosystem is gearing up to meet more than 60 per cent of domestic demand by the end of 2035.
Government’s policy push
This focus on the semiconductor industry is also driven by government policy. After launching the initial India Semiconductor Mission, the government announced phase-2 of the programme—India Semiconductor Mission 2.0—in this year’s Union Budget.
Under the ISM mission, the government brought in schemes to provide up to 50 per cent fiscal support for setting up semiconductor wafer fabrication units, financial assistance of up to 50 per cent of the project cost to set up display fabrication units, and support for setting up units for compound semiconductors, silicon photonics, sensors, and discrete semiconductors.
Over the last few years, the semiconductor industry has gained focus globally, with its applications ranging from healthcare to transport, communication, defence, and space. The global race is being led by countries such as Taiwan, South Korea, Japan, China and the US, with Taiwan producing more than 60 per cent of the world’s semiconductors, including nearly 90 per cent of the most advanced ones.
Highlights from reports
The Deloitte report said that by 2035, segments including mobile phones, automotive, computing, and data centres are expected to account for over 70 per cent of India’s total semiconductor demand.
The report also highlighted the impact of the ongoing geopolitical tensions on the semiconductor imports for India.
“Geopolitical tensions and escalating trade restrictions are reshaping semiconductor supply chains, with far-reaching impacts for artificial intelligence chip innovation, the global economy, national security, and scientific progress,” states the report.
It added that many of these high-tech processes and materials rely on a handful of suppliers, whose dominance in key regions has prompted governments to impose trade barriers to protect strategic interests and reduce dependency.
“Making the world’s most advanced chips for next-generation AI systems and high-performance computing data centres has, for a long time, meant navigating fragile supply chains, but the stakes are much higher now,” states the report.
(Edited by Saptak Datta)