India's semiconductor market to reach $200B by 2035: EY
What's the story
India's semiconductor market is set to witness massive growth, expanding over three times from nearly $64 billion in 2026 to an estimated $200 billion by 2035. The projection was made in a report by Ernst & Young (EY) and the India Electronics and Semiconductor Association (IESA). The study, titled 'Semicon India 2.0: From capacity creation to ecosystem leadership,' highlights the potential of India's semiconductor industry.
Market leaders
Consumer electronics leads the way
The report reveals that consumer electronics account for a whopping 30% of India's semiconductor market.
The automotive sector comes second with a share of 16%, followed closely by industrial applications at 15%.
Emerging sectors such as AI, data centers, telecommunications, electric mobility, and advanced manufacturing are also creating new demand for semiconductors.
Import growth
Need for local manufacturing
India's semiconductor imports have grown over five times from $5.7 billion in FY17 to $30.3 billion in FY25, with a compound annual growth rate (CAGR) of 23%.
This trend highlights the need to convert rising domestic demand into local manufacturing.
The report also notes that India is home to nearly 20% of global chip design engineers, providing a talent pool for domestic design, manufacturing, and commercialization.
Ecosystem potential
Leveraging engineering talent and design capabilities
Ashok Chandak, President of IESA, emphasized India's unique opportunity to leverage its engineering talent, electronics demand, design capabilities and emerging manufacturing capacity with resilient global supply-chain partnerships.
He said the next phase will be defined by execution, innovation, technology commercialization and indigenous IP.
Aisha Ali Hussaini, Partner and Semiconductor Tax Leader at EY India, stressed on India's market scale and engineering talent as key factors in building a connected semiconductor ecosystem that attracts sustained investment.
Future prospects
Recommendations for realizing market potential
The EY-IESA report identified advanced packaging, compound semiconductors, photonics, as well as chip-to-system integration as high-potential opportunity segments.
It suggested aligning state-level policies with Semicon 2.0, creating integrated manufacturing clusters with common infrastructure, and implementing specialized talent-certification programs across fabrication, design and packaging lines.
These steps could help India realize its semiconductor market potential by creating a robust ecosystem that attracts investment while boosting domestic value creation.