India has built a strong semiconductor strategy, but execution, supply chain gaps and import dependence remain major hurdles to scaling domestic manufacturing.
India has established a strong foundation for its semiconductor ambitions, but execution remains the biggest challenge, with more than 90% of chip-making equipment still imported, according to an Equirus Securities report cited by The Economic Times.
The report said India’s semiconductor strategy works on successful elements from leading Asian economies, combining government-backed research and development, foreign direct investment-led manufacturing and support for domestic champions rather than replicating a single model.
According to The Economic Times, India is focusing on outsourced semiconductor assembly and test (OSAT) and mature-node chips between 28nm and 110nm, where it has a competitive advantage. The country is supported by nearly 300,000 chip designers, accounting for about one-fifth of the global talent pool.
“India’s main challenge is execution, not strategy,” the report said, adding that the country must strengthen domestic supply chains, build a skilled workforce and meet global quality standards within a short period.
The report projected India’s semiconductor demand will more than double to US$155 billion by 2031. However, it warned that the country will continue importing over 90% of semiconductor manufacturing equipment and 85-90% of specialty chemicals and electronic-grade gases.
It also identified shortages of process engineers, metrology specialists, yield engineers and cleanroom technicians as key gaps that must be addressed to build a globally competitive semiconductor ecosystem.
