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Press release
19 Sept 2026
|
New Delhi, India
India’s semiconductor market projected to grow threefold to US$200 billion by 2035: EY-IESA report
- Semiconductor imports increased more than fivefold from US$5.7 billion in FY17 to US$30.3 billion in FY25, at a CAGR of 23%
- Consumer electronics, automotive and industrial applications are the largest demand drivers, accounting for 30%, 16% and 15% of India’s semiconductor market, respectively
- India accounts for nearly 20% of the world’s chip design engineers, providing a strong base to scale manufacturing and innovation
New Delhi, 19 September 2026: India’s semiconductor market is projected to grow more than threefold from nearly US$64 billion in 2026 to US$200 billion by 2035, creating a significant opportunity to convert domestic demand into manufacturing, innovation and supply-chain resilience, according to EY–IESA report, Semicon India 2.0: From capacity creation to ecosystem leadership.
As per the EY–IESA report, consumer electronics accounts for 30% of India’s semiconductor market, followed by automotive at 16% and industrial applications at 15%, while AI, data centres, telecommunications, electric mobility and advanced manufacturing are creating new growth avenues. Semiconductor imports increased more than fivefold from US$5.7 billion in FY17 to US$30.3 billion in FY25, at a CAGR of 23%, highlighting the opportunity to translate expanding domestic demand into local manufacturing and innovation. India also accounts for nearly 20% of the world’s chip design engineers, providing a significant talent base to scale semiconductor manufacturing, indigenous design and commercialization.
Ashok Chandak, President, India Electronics and Semiconductor Association (IESA) said, “India now has a unique opportunity to combine its strengths in engineering talent, electronics demand, design capabilities and emerging manufacturing capacity with resilient global supply-chain partnerships. The next phase will be defined by execution, innovation, technology commercialisation, indigenous IP, specialised talent and ecosystem depth. India has moved beyond semiconductor ambition. The opportunity now is to build an ecosystem that the world trusts, India owns and the next generation can scale.”
Aisha Ali Hussaini, Partner and Semiconductor Tax Leader, EY India, said, “India has a powerful combination of market scale, engineering talent and policy momentum. Its rapidly expanding electronics ecosystem adds to this opportunity; electronics production increased sixfold from INR1.9 lakh crore in FY15 to INR11.3 lakh crore in FY25, while electronics manufacturing and exports grew sevenfold and elevenfold, respectively, over the same period. The priority now is to translate this scale into deeper semiconductor value addition by building a connected, innovation-led ecosystem that attracts sustained investment and creates more value domestically. Over the coming decade, a predictable fiscal and regulatory environment, stronger alignment between central and state policies, and focused support for emerging technologies can help improve project viability and accelerate commercialisation. If industry, government and academia work together with a long-term view, India can move beyond being a design powerhouse to play a much larger role across manufacturing, advanced packaging and the wider global semiconductor value chain.”
India has already made significant progress in building its semiconductor ecosystem and is well positioned to build on this momentum. As per the EY-IESA report, the next phase should focus on strengthening and aligning state semiconductor policies with the broader scope of Semicon 2.0, developing integrated semiconductor manufacturing clusters supported by shared, world-class infrastructure, and introducing dedicated talent-certification programmes across semiconductor design, fabrication and advanced packaging.
Looking ahead: opportunity areas and the execution imperative
As global semiconductor value chains are reshaped by diversification and technology transitions, the EY–IESA report identifies advanced packaging, compound semiconductors, photonics and chip-to-system integration as high-potential opportunity areas for India. These segments can build on the country’s design capabilities, growing electronics and AI demand, and emerging manufacturing base to expand its presence in technology-intensive parts of the value chain.
Capturing these opportunities will require coordinated action. Investors will assess policy certainty, cluster readiness and speed of implementation; industry will need deeper partnerships with suppliers, academic institutions and technology owners to localise capabilities; and policymakers must streamline approvals and sustain long-term support for research, talent and supplier development.
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About IESA
The India Electronics and Semiconductor Association (IESA) is spearheading India's semiconductor and electronics manufacturing industry growth by fostering local and global collaborations and partnerships, upskilling, and supporting startups, MSMEs, and academia. Electronics manufacturing has become one of the highest-growth sectors, attracting global markets, and making India an unparalleled hub for sub-contract manufacturing. The objective of IESA is to grow the ESDM business segment in India and make India the preferred destination for electronics & semiconductor design & manufacturing.
IESA strives to promote innovative technology solutions that can positively impact the lives of citizens in India and across the world. This can be achieved only with a healthy dialogue between the Central & State Governments and the industry.
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