The survey report also revealed that industrial applications and telecom stacks in the country will contribute two-thirds of the entire market share
A joint survey report by India Electronics & Semiconductor Association (IESA) and Counterpoint Research has now stated that the market for semiconductor in India is very likely to reach $64 billion by the end of 2026, which is three times more than that of 2019 when the market stood at $22.7 billion. The survey report also revealed that industrial applications and telecom stacks in the country will contribute two-thirds of the entire market share.
In India, the manufacturing of chips will be spearheaded by export and domestic markets with huge demand from the consumer electronics, telecom, IT hardware, and industrial sectors. Highlighting the factors, Tarun Pathak, research director at Counterpoint said, “In the short term, there is a huge opportunity being driven by domestic demand across applications like sensors, logic chips, and analogue devices.”
Tarun further added that local sourcing in India has already begun in India in a large-scale manner, which accounted for 10 percent of the overall market in 2022. Amitesh Kumar Sinha, chief executive officer (CEO) of India Semiconductor Mission and joint secretary of the Ministry of Electronics and Information Technology, said “India is committed to becoming a reliable partner in global supply chains and we are working towards that by framing long-term policies, keeping the next 25 years in mind.”
Now, the Semicon India Program whose budget stands at $10 billion, Centre funds 50 per cent of the semiconductor manufacturing project costs with 2.5 per cent of the budget earmarked for research and development, skill development, and training, reported by Business Standard.
Sinha added, “More than 70 per cent of the project costs for semiconductor manufacturing are incentivised by the Centre and state governments in India of which 50 per cent is funded by the Centre on an upfront basis while the rest is covered by the state governments.”
In fact, the key US companies are being persuaded by the government to set-up their manufacturing centers in India. Micron has already announced plans to invest in India and is expected that the company will commence its manufacturing plant in the coming few months. As per a previous report of Business Standard, IT and Communications minister Ashwini Vaishnaw has met top executives of US companies in San Francisco. He told BS, “The meetings have been very fruitful and the message was clear there is no doubt that India is the next big destination for everyone in semiconductors to invest in.“