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INDIA SEMICONDUCTOR REPORT: STATE OF PLAY

'India Semiconductor Report: State of Play' report attempts to provide an analytical overview of the current state of India’s semiconductor industry. It examines the strategic drivers underpinning the Government of India’s semiconductor push, outlines key industrial policy interventions and offers a detailed assessment of projects across the semiconductor value chain across fabrication, packaging, ancillaries, design capabilities and skilled workforce availability. By systematically mapping key projects, investment patterns, and implementation timelines, the report identifies which segments of the semiconductor value chain are gaining traction, where progress is uneven, and where structural bottlenecks persist. This integrated “state of play” analysis offers a granular understanding of the rapid but uneven growth of India’s semiconductor ecosystem.

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An Analytical Overview of the Current State of India's Semiconductor Industry

Outline of Key Industrial Policy Interventions

Detailed Assessments and Systematic mapping of Projects 

Identifying segments of the value chain which are gaining traction 

In 2024, India made significant strides towards its ambition to develop a comprehensive semiconductor ecosystem. The year witnessed the groundbreaking of the country’s first commercial silicon fabrication facility, the approval of three advanced packaging units, and a pioneering  agreement with the United States, facilitated through the United States–India Initiative on Critical and Emerging Technology(iCET) mechanism, to jointly develop a national security-focused semiconductor fab. Domestic conglomerates including Tata, Adani, and HCL formally entered the sector, marking a significant shift in India’s industrial and technological priorities.

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To date, projects worth $17.83 billion have been approved including Tata Electronics' $11 billion JV with Taiwan’s Powerchip Semiconductor Manufacturing Company (PSMC), the proposed Shakti fab in collaboration with the U.S. Space Force, and four OSAT/ATMP packaging facilities. Should two other proposals including Adani’s $10 billion analog fab in partnership with Israel’s Tower Semiconductor, and another packaging facility awaiting government approval materialise, total investments are likely to exceed $30 billion in India.  

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India’s semiconductor ambitions are embedded within a broader industrial strategy aimed at catalyzing export-led manufacturing across critical sectors such as electronics, renewable energy, and defense. This effort is part of a larger economic vision to accelerate a “farm-to-factory” transition along the lines of the successful industrialization trajectories of East Asian economies. India’s industrial policy measures including large-scale Production Linked Incentive schemes for smartphones, electronics and  renewable energy manufacturing combined with a rapidly-growing defense manufacturing sector and increasing domestic consumption are expected to nearly triple semiconductor demand from $38 billion in 2023 to over $100 billion by 2030, growing at 15% CAGR to potentially represent 10% of global demand. Semiconductor packaging, in particular, is emerging as a pragmatic near-term opportunity for scale and strategic positioning given its lower capital intensity, faster setup timelines and compatibility with India’s existing strengths in electronics assembly and testing.

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India’s value proposition to global investors is shaped by a unique set of advantages: rapidly-growing domestic electronics manufacturing, world-class design talent, growing domestic consumption, deepening strategic alignment with the U.S. and EU, and a reform-oriented industrial policy framework. New Delhi seeks to position itself as a “trusted partner” for the US and the EU by active engagement through channels such as the U.S.–India iCET mechanism,  the EU-India Trade and Technology Council and Quad initiatives.  India has also actively pursued bilateral partnerships with key technology-producing nations, signing memorandums of understanding (MoUs) and strategic cooperation agreements with Japan, South Korea, Taiwan, Singapore, and the European Union, focused on technology transfer, skill development, R&D, and investment facilitation. 

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These partnerships aim to integrate India into global semiconductor value chains by leveraging foreign expertise and enabling domestic capacity-building. The Ministry of External Affairs and Ministry of Electronics and IT (MeitY) have played a proactive role in brokering these relationships, often linking them to broader strategic frameworks such as the Quad, India–EU Technology and Trade Council and respective  bilateral mechanisms. 

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Project Lead: 
Shyam Krishnakumar 

shyam@pranavainstitute.com

©2025 by The Pranava Institute.

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