Semiconductor Industry in India

The Semiconductor industry in India is growing rapidly, as the country’s mission is to become a global hub for chip manufacturing and design. With the increasing demand of electronics products, India has recognized the strategic importance of developing a robust customer. The Indian government has also taken lots of initiatives like Make in India and Production Linked Incentive (PLI) to encourage entrepreneurs and investors. There are lots of companies in India who are doing great in this field.

Know about the Semiconductor Manufacturing Companies in India.

This blog provides an overview of India’s semiconductor development, highlighting the country’s increasing tech community, skilled professionals, and supportive governmental policies. It also addresses the global trend that challenges China ‘s dominance in manufacturing. Let’s see how India is positioning itself to become a major player in semiconductor manufacturing.

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Semiconductor Industry in India – An overview

The following section outlines the timeline of key initiatives and efforts made by the Indian government to establish a robust semiconductor value chain in India.

In 2022, the Indian semiconductor market was valued at US$ 26.3 billion and is expected to grow at a CAGR of 26.3%, reaching  US$ 271.9 billion by 2032.

consumption has increased due to the growing from the Indian customers, especially for mobile devices and computers. The government is also promoting  digital adoption, making rural areas to use digital methods for education and transactions. Additionally, the number of Indian start-ups has grown they rely on  more electronic gadgets are being used.

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Factors favouring India Skilled workforce

India leads globally with a record number of Science, Technology, Engineering and Mathematics (STEM) graduates, providing the highly skilled workforce essential for semiconductor manufacturing, design, research, and development.

Cost advantage

India provides a significant cost advantage for semiconductor manufacturing due to several factors:

Labour costs

Labour costs in India are lower than in developed countries, which helps semiconductor manufacturers reduce production costs especially for jobs which need semiconductor manufacturers, particularly in labour- intensive processes such as assembly and testing.

Supply chain efficiency

India’s close location to key semiconductor markets in Asia, Europe and the Middle East helps manage the supply chain management. Lower transportation costs and shorter delivery times contribute to significant  cost savings for semiconductor manufacturers operating in India.

Emerging ecosystem

As India invests in research and development, infrastructure and skill enhancement programmes, to strengthen its semiconductor ecosystem, the overall cost-effectiveness of semiconductor manufacturing is expected to improve further.

Global supply chain diversification

The semiconductor value chain, Traditionally concentrated in the US and its allies (South Korea, the Netherlands, Japan, and Taiwan), as well as China, has experienced a shift. Pandemic-related disruptions and rising labour costs have led global producers to diversify their operations away from china. These areas include design, manufacturing and final product sales. 

India has emerged as a preferred destination for back-end assembly and testing operations amid the industry’s relocation, with the potential for future front-end manufacturing. India’s involvement in this ecosystem is strategically important for  diversifying the global supply chain. its stable political environment and large domestic market make it an attractive option  for technology companies looking for greenfield expansion opportunities.

Government initiatives : The India Semiconductor Mission (ISM) operates as a dedicated division within the Digital India Corporation, aimed at fostering a robust semiconductor and display ecosystem. Its main role is to make India a key player in the semiconductor manufacturing.Guided by international experts in the semiconductor and display sectors, ISM acts as a central authority for executing the Programme for Development of Semiconductor and Display Ecosystem. It works in close coordination with government ministries, industry and academia.

Investments in semiconductor industry : In the Indian semiconductor industry, significant investments have been made highlighting the country’s growing importance on the global scenario.Both domestic and international bodies have established their production facilities and research centres across India. For example, Tata Electronics has made investments in Gujarat and Assam, along with partnerships with leading global companies PSMC and Renesas Electronics Corporation. This demonstrates the scale and objectives of these.These investments are more than financial investments; they reflect confidence in India’s potential as a global centre for semiconductor production and highlight India’s importance in the world supply chain. This position also gives India an advantage in attracting more investments supported by ongoing government backing and generous policies.

Conclusion 

India is one of the key players in the global semiconductor industry. There is lots of potential in the semiconductor industry in India, there are lots of investors who are investing in this sector, and supportive government policies. The country’s strategic location, cost advantages, and workforce make it one of the best choices for key investors.

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