From AI-driven demand to automotive electrification, India’s semiconductor ambitions surge, with the market forecast to hit US$300 billion by 2035 amid massive investment and localisation.
India’s semiconductor market is projected to reach around US$120 billion by 2030 and US$300 billion by 2035, according to Deloitte’s ‘Technology, Media, and Telecommunications Predictions 2026’ report.
The growth, estimated at a compound annual growth rate (CAGR) of 20 per cent, will be driven by the adoption of artificial intelligence (AI), automotive demand, and data centre expansion.
Currently, India imports more than 90 per cent of its semiconductor requirements. However, Deloitte forecasts a structural shift, with local production expected to meet over 60 per cent of domestic demand by 2035.
The report highlighted that India’s semiconductor market, valued at US$45–50 billion in FY2024–25, has already been expanding rapidly.
By 2035, India is expected to host 45 silicon fabs, eight to 10 compound fabs, 12 display fabs and 20–25 Outsourced Semiconductor Assembly and Test (OSAT) facilities, supported by the India Semiconductor Mission (ISM) and state-level incentives.
Mobile phones, automotive, computing and data centres are projected to account for more than 70 per cent of demand.
The sector has already attracted US$19 billion in investments across 10 approved projects, including eight OSAT facilities, one compound fab and one semiconductor fab. A further 18-20 proposals worth US$20–25 billion are under consideration.
Deloitte estimates an additional US$50 billion in capital investment over the next five years, with US$75-80 billion expected between 2030 and 2035 to expand the ecosystem.
Employment opportunities are forecast to reach two million by 2035, with roles spread across manufacturing, design services and the wider value chain. To support this scale-up, the industry will need to train 400,000-500,000 people annually.
However, the report cautions that sustaining momentum will depend on execution, urging policymakers to move beyond time-bound incentives towards a national programme with long-term funding certainty and improved coordination between central and state authorities.
