Overview

The EY‑IESA report Semicon India 2.0: From capacity creation to ecosystem leadership was unveiled at the SEMICON India 2026 event, projecting a transformative expansion of India’s semiconductor ecosystem.

Market Size and Growth

India’s semiconductor imports surged from USD 5.7 billion in FY17 to USD 30.3 billion in FY25, a compound annual growth rate (CAGR) of 23%. The report forecasts the domestic semiconductor market to rise from roughly USD 64 billion in 2026 to USD 200 billion by 2035, representing more than a threefold increase.

Demand Drivers

Consumer electronics accounts for 30% of the market, automotive for 16%, and industrial applications for 15%. Additional growth avenues are identified in artificial intelligence, data centres, telecommunications, electric mobility and advanced manufacturing.

Talent Base

India contributes nearly 20% of the world’s chip‑design engineers, providing a substantial talent pool to support manufacturing, indigenous design and commercialization efforts.

Industry Perspectives

Ashok Chandak, President of IESA, emphasized India’s unique combination of engineering talent, electronics demand, design capability and emerging manufacturing capacity, calling for execution, innovation, indigenous IP and ecosystem depth. Aisha Ali Hussaini, Partner and Semiconductor Tax Leader at EY India, highlighted that electronics production grew sixfold from INR 1.9 lakh crore in FY15 to INR 11.3 lakh crore in FY25, while electronics manufacturing and exports expanded sevenfold and elevenfold respectively. She stressed the need for a predictable fiscal and regulatory environment, stronger central‑state policy alignment, and focused support for emerging technologies to improve project viability.

Electronics Production Growth

Electronics production rose from INR 1.9 lakh crore (FY15) to INR 11.3 lakh crore (FY25). Over the same period, electronics manufacturing increased sevenfold and exports grew elevenfold, underscoring rapid scale‑up of the sector.

Policy and Ecosystem Recommendations

The report calls for aligning state semiconductor policies with the broader Semicon 2.0 agenda, creating integrated manufacturing clusters with shared world‑class infrastructure, and launching dedicated talent‑certification programmes across design, fabrication and advanced packaging.

Opportunity Areas

  • Advanced packaging
  • Compound semiconductors
  • Photonics
  • Chip‑to‑system integration

These segments can leverage India’s design strengths, rising electronics and AI demand, and emerging manufacturing base.

Execution Imperatives

Investors will evaluate policy certainty, cluster readiness and implementation speed. Industry players must deepen partnerships with suppliers, academia and technology owners to localise capabilities. Policymakers need to streamline approvals and sustain long‑term support for research, talent development and supplier ecosystems.