- In its report, Deloitte mentioned that the Indian chip industry would generate employment for 600,000 people by 2030.
- Through various incentive schemes, the government intends to draw focus towards domestic design and manufacturing of semiconductors.
India’s semiconductor industry is touted to reach $55 billion by 2026 with more than 60% of the market is driven by three industries which include smartphones and wearables, automotive components, and computing and data storage.
Consultancy firm Deloitte released the figures in its Technology, Media, and Telecommunications (TMT) Predictions report for 2023.
In a release, the company said, “With growing demand, the Indian chip industry is poised to play an important role in enhancing the global value chain as it will expand to a market size of $85 billion and generate employability for 600,000 by 2030.”
The growth estimates take into consideration the government’s focus on domestic design and manufacturing of semiconductors by attracting investments via production-linked incentive (PLI) and direct-linked incentive (DLI) schemes.
Partner and TMT (technology, media, and telecom) industry leader at Deloitte India, PN Sudarshan explained that the importance of the semiconductor chip industry had been amplified due to the chip shortage. He said that it had exposed the underlying risks in the value chain, owing to geopolitical threats, fluctuating demand from OEMs, natural disasters and economic sanctions. This situation, however, presented a unique opportunity for India, positioning it as the next big manufacturing destination.
“Driven by key factors, including a rise in semiconductor content, the advent of 5G and IoT, and data storage requirements, the sector will also attract investment, talent and bi-lateral ties focusing on supply chain, resilience, and localisation setting in India,” he said.
Major investments by big semiconductor companies are already underway. Vedanta-Foxconn joint venture, Innovative Global Solutions & Services Ventures and International Semiconductor Consortium (ISMC) have proposed to set up chip manufacturing plants with a $13.6-billion investment and have sought the support of $5.6 billion from the government under the ₹76,000-crore incentive scheme for development of semiconductors and display manufacturing ecosystem, launched in December 2021.