India's Semiconductor Mission: A roadmap to technological self-reliance

India has seen a remarkable economic ascent in recent years. This growth is primarily fuelled by initiatives such as Make in India and Atmanirbhar Bharat, focusing on bolstering domestic capabilities and strengthening the nation as a global manufacturing hub. In this direction, a noteworthy factor is also the country's growing focus, seriousness, and commitment towards achieving technological self-reliance, particularly in chip manufacturing, critical for its strategic and economic imperatives. It is also essential especially in this digital era when transformative technologies like AI and others are revolutionizing critical sectors such as healthcare, electronics, automobiles, communication, and many. Expediting efforts for technological self-reliance and chip manufacturing with concrete steps, backed by government policies, further opens newer avenues for India to demonstrate its prowess in this strategic domain globally. 

Govt. support strengthening foundation of domestic chip manufacturing

Taking a closer look at India's promising future as a chip manufacturing hub, the bedrock of this growth lies in the Centre's push to boost domestic manufacturing which includes development and design of semiconductor fabs and assembly, testing, marking, and packaging (ATMP) facilities. Aligned with this, the launch of India's Semiconductor Mission by the Indian Government, which pledges substantial investments worth $10 billion is strengthening the foundation of a thriving chip manufacturing industry here.

Furthermore, Production Linked Incentive Schemes including a comprehensive program for developing semiconductor and display manufacturing ecosystems with incentives worth ₹76,000 crore along with initiatives such as Design Linked Incentive, Semiconductor Fabs and Display Fabs schemes, Chips to Startups (C2S), and Scheme for Promotion of Electronic Components and Semiconductors (SPECS), are laying the groundwork for making India an important player in global semiconductor market. 

These developments not just support domestic manufacturing, but strengthen the confidence of global players to step forward and become partners in the country's chip manufacturing ambitions.
 
Global collaborations and investments catalyzing industry’s growth

Currently, the Indian semiconductor landscape is undergoing a seismic shift, buoyed by significant investments and collaborative initiatives. For instance, efforts are already underway for establishing a semiconductor assembly and testing facility in Gujarat by a US-based semiconductor manufacturing company announcing an investment of $800 million. Also the recent inauguration of a cutting-edge research and development campus in Bengaluru by a US chipmaker with a planned investment of $400 million over the next few years, is going to be pivotal in enhancing India's design expertise and development of semiconductor technology. 
States like Gujarat, Odisha, and Uttar Pradesh have announced their own semiconductor policies and similarly, Karnataka, Telangana, Tamil Nadu and others are also racing ahead to emerge as manufacturing hubs with infrastructure. supportive policies and governance, conducive business climate, and skilled human capital. The country certainly has a competitive edge in manufacturing in terms of cost-efficiency, ease of doing business, technical excellence, demographic benefits and quality infrastructure, serving as key attractions for global companies to set up their centres here. These factors are set to bring about a substantial transformation in India’s semiconductor sector in the coming period.

India’s chip manufacturing dreams: Promising future ahead

According to by McKinsey, the domestic semiconductor market which was valued at approximately $23.2 billion, is projected to reach $80.3 billion by 2028, growing at a compound annual growth rate (CAGR) of 17% during the forecast period. It shows that all factors are in favour of India, supporting the creation of a thriving ecosystem for semiconductor manufacturing. 

And for the country to maintain its upward trajectory and efficiently translate its chip manufacturing dream to a reality, it has to keep on strengthening its position as an attractive investment hub for chip makers across the globe. Additionally, it also requires more collaborations with global partners for enhancing chip manufacturing capabilities, enhancing global competitiveness, and importantly supporting skill development for bringing both expertise and experience, equipping local talent with required technical expertise.
 
In essence, India's semiconductor journey epitomizes its aspirations for technological self-reliance and global leadership. With concerted efforts from the government, industry, backed by strategic investments and global collaborations, the country’s emerging semiconductor industry is poised to play a leading role by making in India for the world. 

Srinivas Prasad

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Srinivas Prasad is Senior Director & Site Head at Analog Devices Inc India.