NITI Aayog recently released a comprehensive 10-year roadmap report titled “Future of India’s Semiconductor Industry”, aimed at transforming India into a major player in the global semiconductor ecosystem. Unveiled by Finance Minister Nirmala Sitharaman and Union Minister for Electronics and Information Technology Ashwini Vaishnaw, the roadmap seeks to build a US$ 120–150 billion domestic semiconductor value chain by 2035.

The roadmap complements the recently launched India Semiconductor Mission (ISM) 2.0, under which India aims to develop a full-stack semiconductor ecosystem, including advanced nodes reaching 2-nanometre (2nm) technology, indigenous intellectual property (IP), and robust manufacturing capabilities.

Background

• Semiconductors, often referred to as the “brains of modern technology,” are essential components powering smartphones, electric vehicles (EVs), defence systems, telecommunications networks, Artificial Intelligence (AI), renewable energy systems, and industrial automation.
• Recent geopolitical tensions, supply-chain disruptions during the COVID-19 pandemic, and technological rivalries among the United States, China, Taiwan, Japan, and South Korea exposed the vulnerability of highly concentrated global chip manufacturing systems. Consequently, countries worldwide are pursuing semiconductor self-reliance to secure technological sovereignty and economic resilience.
• Despite possessing a globally competitive semiconductor design workforce, India remains heavily dependent on imported chips. Therefore, this roadmap aims to reposition India from being merely a semiconductor consumer to an indispensable participant in the global value chain.

Key Highlights of the Roadmap

1. Ambitious Economic Targets

• The roadmap sets ambitious but strategic long-term targets:
• Building a US$ 120–150 billion domestic semiconductor ecosystem by 2035.
• Achieving 10–13% participation in the global semiconductor market.
• Ensuring 35–50% self-sufficiency in domestic semiconductor demand.

2. Funding Structure and Investment Requirements

To establish a competitive semiconductor ecosystem, the report estimates a total requirement of US$ 135–180 billion in investments over the next decade.

To mobilize this, the roadmap proposes a Semiconductor Support Fund, under which the Government of India would commit US$ 45–60 billion as anchor capital—approximately one-third of total investments—to de-risk long-cycle projects and attract private capital.

3. Strategic Technology Priorities

Rather than competing blindly in highly capital-intensive legacy fabrication races, the roadmap prioritizes sectors where India can gain comparative advantage.

Advanced Packaging and Testing

India seeks to become a global hub for advanced semiconductor packaging, Outsourced Semiconductor Assembly and Testing (OSAT), and advanced technology nodes, leveraging its strong engineering and design capabilities.

Compound Semiconductors and Wide-Bandgap Materials

The roadmap prioritizes materials such as Silicon Carbide (SiC) and Gallium Nitride (GaN), which are critical for:

• Electric mobility and EV batteries
• Renewable energy systems
• Power electronics
• 5G and 6G communication infrastructure

AI-Native Chip Design

The roadmap strongly advocates support for domestic chip-design firms to build sovereign semiconductor intellectual property (IP). It also proposes the adoption of AI-assisted Electronic Design Automation (EDA) tools for accelerated innovation.

4. Human Capital and Institutional Development

The report emphasizes creation of a standardized semiconductor talent ecosystem through:

• Specialized semiconductor education programs
• Cleanroom technician training
• Advanced chip-design engineering pathways
• Establishment of a proposed National Fab Academy to bridge skill gaps

5. Strategic Partnerships

The roadmap recommends deeper technological collaboration with trusted geopolitical partners such as:

• United States
• Japan
• South Korea
• European Union

Such partnerships are expected to enhance supply-chain resilience, technology transfer, and investment flows.

Significance of the Roadmap

Technological Sovereignty

• Semiconductors are increasingly central to national security, digital governance, cyber infrastructure, and defence preparedness. Domestic capability would reduce strategic dependence on imports.

Economic Growth and Employment

• A strong semiconductor ecosystem can generate high-value employment opportunities across manufacturing, R&D, design engineering, AI systems, logistics, and electronics production.

Boost to ‘Atmanirbhar Bharat’

• The roadmap aligns with flagship programmes such as Digital India, Make in India, Startup India, PLI Scheme, and Viksit Bharat 2047, strengthening India’s technology-led growth model.
• Supply Chain Diversification
• India could emerge as a trusted destination under the global China+1 strategy, thereby increasing resilience in global semiconductor supply chains.

Challenges

• High Capital Intensity: Semiconductor manufacturing requires enormous investments and long gestation periods.
• Infrastructure Deficits: Reliable electricity, ultra-pure water, logistics, and cleanroom facilities remain limited.
• Technology Dependence: Critical equipment and patents remain concentrated among a few countries.
• Skill Gaps: India still faces shortages of fabrication engineers and process specialists.
• Global Competition: Established semiconductor powers such as Taiwan, China, and South Korea already dominate the market.

Government Initiatives

• India Semiconductor Mission (ISM) 2.0 for end-to-end semiconductor ecosystem development.
• Production Linked Incentive (PLI) Scheme for electronics manufacturing.
• Promotion of indigenous semiconductor design through Design Linked Incentive (DLI) support.
• Semiconductor fabrication and packaging projects approved in states such as Gujarat and Odisha.

Way Forward

India should prioritize strategic niche leadership instead of indiscriminate competition in advanced fabrication. Developing National Semiconductor Zones, strengthening industry-academia collaboration, investing in human capital, expanding trusted global partnerships, and promoting domestic procurement in defence, railways, telecom, and electronics sectors can significantly improve ecosystem viability.

Conclusion

The “Future of India’s Semiconductor Industry” roadmap represents a strategic shift from semiconductor dependence to semiconductor resilience. By focusing on advanced packaging, compound semiconductors, AI-native chip design, and trusted partnerships, India seeks not merely to participate in the global semiconductor race but to become an indispensable node in the international chip ecosystem. Effective implementation of this roadmap could significantly enhance India’s economic competitiveness, technological sovereignty, and national security in the coming decades.