India’s semiconductor market was worth about $38 billion in 2023, and it is projected to more than double by 2030. To be exact, it is projected to reach $100-110 billion, growing at a 13.7-19% CAGR. This explosive outlook explains why India Chip Manufacturing is now at the centre of government strategy and business ambition.
The Driving Policy Behind India Chip Manufacturing
In 2021, the Indian government launched the India Semiconductor Mission, allocating ₹76,000 crore (~$9.5 billion) to support chip fabs, design centres, and display vendors.
On top of that, the Production Linked Incentive (PLI) scheme is poised to receive another $20 billion to help India compete with global subsidy giants like the US ($52 billion CHIPS Act) and China ($47.5 billion fund).
First Domestic Chip & 3nm Innovation
India plans to roll out its first domestically produced semiconductor chip by the end of 2025, using familiar 28-90 nm technology. Equally bold: two 3‑nanometre design centres have launched in 2025—an advanced step that moves India closer to global AI chip standards.
Annual flows of 1.5 million engineering graduates make India a fertile ground for design and innovation. By partnering with global tech firms, the country builds both capacity and credibility.
Global Supply Chain Risks and Strategy
Currently, Taiwan produces over 60% of global semiconductors and nearly 90% of cutting-edge chips. This concentration exposes global commerce to geopolitical risks and supply shocks.
India aims to diversify global manufacturing, with its expanding infrastructure, rich resource base, and support for SMEs in chip equipment and supply services. India Chip Manufacturing is part of that diversification.
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India Chip Manufacturing: Leading Projects and Partnerships
A flagship venture is the joint ₹37 billion (US$433.6 million) HCL‑Foxconn chip plant near Jewar Airport. It will produce display driver chips with a capacity of 20,000 wafers per month, targeting automotive, PC, and mobile industries.
Major global tech companies including Applied Materials, Lam Research, Merck, and Linde are joining India’s semiconductor ecosystem. Meanwhile, design centres in Noida and Bengaluru are pushing frontier chip R&D at 3nm node and beyond.
Boosting SME Access and Export Potential
Indonesia’s SMEs in disciplines like automotive parts, electric vehicles, and critical minerals now get a helping hand. Government efforts simplify licensing and customs to help these smaller players integrate into global supply chains. This bottom‑up access is key to scaling India Chip Manufacturing beyond large fabs into a resilient ecosystem.
Smart India Chip Manufacturing for AI‑Powered Growth
Domestic demand for AI‑optimized chips is rising fast. India’s expansion in digital infrastructure—cloud, data centres, edge computing—is consuming advanced chips at full force. With its design talent and growing manufacturing base, India is positioning to serve both local and global AI needs.
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Investment Opportunities and Future Outlook
The government expects $15 billion-plus in inflows into chip manufacturing, OSAT, and ATMP sectors. With a strong policies, skilled workforce, and widening private‑public collaboration, India is offering fertile ground for AI and hardware firms seeking a scalable alternative to East Asian production hubs.
India Chip Manufacturing: A Strategic Technology Pivot
In sum, India Chip Manufacturing is no longer an aspiration, but a strategy. With supportive policies, rapidly growing infrastructure, and bold industrial ties, India is betting on becoming a sovereign technology hub. The country’s semiconductor momentum could reshape Asia’s role in the global AI hardware race.
FAQs
1. When will India produce its first domestically made chip?
India aims to roll out its first chip built with 28-90 nm technology by the end of 2025.
2. What incentives support India’s chip industry?
The India Semiconductor Mission and the additional $20 billion PLI scheme drive investments in chip fabs and design.
3. What is the projected size of India’s semiconductor market?
The industry is expected to double from $38 billion in 2023 to $100-110 billion by 2030.
4. Who are major partners in India’s chip drive?
Projects involve HCL‑Foxconn, with global firms like Applied Materials, Lam Research, Merck, and Linde collaborating.
5. How does India fit into global chip supply chains?
India offers supply chain diversification beyond Taiwan, strong engineering talent, and growing local chip and component manufacturing.
