Due to the increasing utilization of technologies such as 5G, AI, IoT, and Electric Vehicles, the Indian semiconductor market is expected to reach USD 110 billion by 2030.
Under the Semicon India Program, the Government of India has announced an investment of USD 10 billion in the semiconductor sector and display manufacturing ecosystem. In line with the goals of Aatmanirbhar Bharat (Self-Reliant India), this significant funding demonstrates India's dedication to strengthening its position in global supply chains. Due to increasing demand across multiple sectors and an increased semiconductor content per device, it is estimated that the display market will achieve a valuation of USD 15 billion by 2025.
The recent initiative offers substantial incentives to promote investments and foster a sustainable business environment in India. Notably, there will be a 50 percent incentive on project costs for semiconductor and display fabrication facilities operating across various technology nodes.
Through the initiative, 50 percent capital expenditure support is available to investors in compound semiconductor and Outsourced Semiconductor Assembly and Test (OSAT) facilities. In addition, the program seeks to support local startups, MSMEs, and semiconductor design companies by providing up to 50 percent reimbursement for qualified expenses and a deployment-linked incentive of 4 - 6 percent of net sales turnover over 5 years. This support includes design infrastructure such as capabilities for post-silicon validation and prototyping.
Understanding the importance of a trained workforce, the government has a thorough training program to produce 85,000 semiconductor engineers. The industry will be driven by a specialized institution that will cultivate talent and conduct research and development.
The electronics manufacturing ecosystem in India and its impact on global supply chains are anticipated to be profoundly improved by this strategic investment. The future of electronics worldwide could be significantly influenced by India's expanding semiconductor business since semiconductors are essential to modern electronics, ranging from industrial automation systems to smartphones.
