By Shetal Mehta, Co-Founder of Suchi Semicon
The application of semiconductor chips is growing very quickly. Chips in the future will be utilised not only in computers and phones. But also, they will be in our bodies, houses, cars, and roads. India needs to prepare for the future in its economy and security as it targets to become a prominent technology nation.
As India’s semiconductor industry will likely breach around $64 billion in 2025, chip demand will only increase. India is being driven by increasing smartphone usage, consumer electronics, electric vehicles, and industrial automation across the world. With 5G becoming operational, increasing proliferation of smart devices, and shifting to electric mobility, there is a growing requirement for high-performance, power-efficient chips. Take the transportation segment, for example – alone in FY2023–24, 571,000 plus electric scooters were sold, underlining how quickly this space is changing. Nevertheless, purpose-built chip demand is increasing across markets like smart homes, car factories, and medical devices. As the digital revolution gathers steam everywhere, chip demand in India is ready to soar at an even quicker pace than ever before.
Take the case of smart homes, where appliances such as lights and refrigerators will have chips to facilitate automation and connectivity. Electric vehicles (EVs) and driver assistance systems (ADAS) are also radically changing cars. These two extensively utilise advanced chips. Electric scooter sales in India rose considerably to 571,411 in 2024–2025, reflecting a high demand for chips in the transport industry. In addition, far more specialised chips will be needed for network equipment, factory sensors, and robots as India transitions to 5G networks and more factories get automated.
Moreover, chips shall become increasingly important in the medical field for use in internal body devices and medical scanning equipment. Chips in sensors will enhance the use of resources and efficiency even in agriculture and construction, and road maintenance. New chips are also required for emerging technology businesses in India to develop new products, and this will increase demand still further.
India has to do a lot of things to be ready for this future. It has to first make more chips locally. India imports most of its chips from other countries. The Indian government has put a lot of money (₹76,000 crore) into programs like the India Semiconductor Mission (ISM). By supporting companies that build chip factories and packaging plants, this program will set India on the path to becoming a significant producer and designer of electronics. To take an example, the cost of eligible projects will be funded up to 50% under the Modified Scheme for Establishing Semiconductor Fabs in India.
But it is not only chip-making that India needs. It also needs skilled labor. By 2027, the Indian chip market is likely to need about 300,000 trained personnel, reports suggest. These will be working on research, design, production, and packaging of chips. The government is partnering with over 300 Indian institutes of higher learning to offer specialised chip technology courses to hire these personnel. They are also partnering with industry and revising the curriculum. Initiatives that give students practical training, like TeamLease Degree Apprenticeships, are also useful.
India needs to focus on new concepts and research as well. The government’s Design Linked Incentive (DLI) scheme gives funding and support for chip design. It is also important to support new chip firms. India has over 100 chip startups at present, and their innovative ideas can be used in producing, designing, and manufacturing chips.
India is making promising strides in strengthening its position within the global semiconductor value chain, particularly in advanced packaging and OSAT services. While the ecosystem for upstream components like silicon wafers, specialty gases, and high-purity chemicals is still evolving, the country is gaining momentum in downstream activities where value-added services like chip assembly, testing, and packaging play a critical role.
With focused government initiatives and private sector participation, India is building the capabilities required to become a competitive hub for semiconductor packaging. This is especially important as global players seek trusted, diversified supply chains beyond traditional centers like Taiwan, South Korea, and Malaysia. These countries have a head start, but India’s agility, growing technical expertise, and cost competitiveness offer significant potential. With the right investments in infrastructure, R&D, and skilled talent, India is well-positioned to become a key player in advanced semiconductor packaging and a preferred destination for OSAT services.
In short, India stands at a pivotal moment in its semiconductor journey. With rising global demand, government-backed initiatives, and a growing focus on chip packaging and OSAT services, the country is laying the groundwork to become a major player in the global chip industry. While raw materials and infrastructure challenges remain, India’s agility, innovation, and skilled talent pool provide a strong foundation. With the Government continuing to invest in research, education, and ecosystem development, India is preparing not just to catch up but to lead in the future of semiconductors
