Published By: Sayan Paul

India's Semiconductor Journey: 2024 Highlights and What to Expect in 2025

India is aiming to become a leading hub for semiconductor manufacturing by 2030.

From automotive to telecommunications to advanced AI systems and more - semiconductors have become literally the backbone of modern technology. And recognizing the global demand, India too is strengthening its presence in the industry through proper initiatives and investments. According to several reports, India's semiconductor market size was at USD 29.84 billion in FY2023 and is expected to reach USD 79.20 billion by FY2031, with a compound annual growth rate (CAGR) of 13.55%. Also, it may create over 1 million jobs by 2026.

The year 2024 has been remarkable in this matter, be it in boosting production or attracting foreign investments. But you know what's better? Well, the upcoming year holds even more possibilities. As 2024 is coming to an end, let's have a look at this year's highlights in India's semiconductor sector, and discuss what to expect in 2025.

(Credit: Narendra Modi)

2024 Major Highlights

The India Semiconductor Mission (ISM)

The India Semiconductor Mission (ISM) was launched in 2021 with a total financial outlay of Rs 76,000 crore, aiming to boost India's semiconductor ecosystem. The project has grown significantly this year, with Prime Minister Narendra Modi announcing that it will become even bigger over the next five years. Under the mission, several projects have been approved this year, including Tata Electronics setting up a semiconductor fab facility in Dholera with Rs 91,526 crore investment. Both central and state governments are now providing subsidies to semiconductor units to bolster the entire ecosystem.

(Credit: Ashwini Vaishnaw)

Partnership With Singapore, US

Back in September, India and Singapore signed a Memorandum of Understanding (MoU) on Semiconductor Ecosystem Partnership, allowing Singaporean semiconductor companies to enter the Indian market. This was a major move, as forging a partnership with a leading player like Singapore would only help Indian companies accelerate their growth.

Prime Minister Narendra Modi with his Singapore counterpart Lawrence Wong 

After Singapore, India also joined forces with the United States to set up a cutting-edge national security semiconductor fabrication plant.

Semicon India 2024

At the Semicon India 2024, Prime Minister Narendra Modi presented a plan, which explores India's semiconductor strategies and policies. The three-day event featured participation from top executives of major global semiconductor companies, who explained their vision. "We are creating a semiconductor workforce of 85,000 engineers, technicians, and R&D experts," said PM Modi. Also, he mentioned the establishment of a Rs 1 trillion fund under the Anusandhan National Research Foundation to enhance India's research capabilities. Further, he added the country has attracted foreign investments worth over Rs 1.5 trillion.

In addition to the government's policies, multiple private companies have come forward this year to support India's semiconductor ecosystem. And those are going to be shaped in the coming year.

(Credit: The Indian Index)

What To Expect In 2025

Growth Prospects

The growth prospects for India's semiconductor industry in 2025 seem very strong. Micron Technology announced this year that the first memory chips will be produced in India in early 2025. The Tata Electronics Assam ATMP facility and the Sanand facility of CG Power among others will be available as well, contributing enormously to the industry's growth. Also, various projects (such as the one by CG Power in Gujarat and the Advanced Technology Manufacturing Plant (ATMP) by Tata Electronics in Assam) are expected to boost semiconductor chip packaging facilities in 2025. On the other hand, technological advancements such as cloud computing, 5G, and EVs to AI and VR are also increasing demand.

By early 2026, India's semiconductor industry is expected to generate over 3 lakh jobs in various domains. And with time, it may outpace the other major players in terms of supply chain.

More Support From The Government

Given India's semiconductor ambition, there's likely to be additional support from the government in 2025. Following the US model, multiple states may introduce policies that will help private companies to thrive. Gujarat is undoubtedly the epicenter in this matter, and will only strengthen its presence better in the coming year. Also, there could be more financial incentives to set up labs, testing facilities, and more.

More importantly, the government is expected to launch various programs to create a robust workforce.

(Credit: Sandeep)

Commitment To Sustainability

Semiconductor production relies heavily on energy and water resources and hence is quite harmful to the environment. However, thanks to the rise of advanced technology, we can expect the Indian government to focus more on sustainability in 2025. Under the India Semiconductor Mission, various high-tech clusters have been approved for energy and water conservation. On the other hand, reducing carbon emissions is going to be another focus for sure.

(Credit: India Cellular & Electronic)

India is still in the early stages of establishing itself as a global semiconductor hub. But with proper strategies, it can soon achieve its goal and set an example globally. Now, let's wait and see what the journey ahead looks like.