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India's semiconductor market is projected to reach USD 155 billion by 2031, according to a report by Kotak Mahindra Mutual Fund. This represents a compound annual growth rate (CAGR) of 20%, which would boost India's share of global semiconductor consumption to around 9% by the same year. The country currently generates approximately USD 62 billion in semiconductor revenue, accounting for about 6% of global consumption. By 2031, this market is expected to expand significantly.

India's semiconductor market growth is driven by a thriving chip-design ecosystem, with around 3 lakh skilled designers making up about 20% of the global workforce. The country currently holds a "Strong" position in chip design and aims for "Leadership" by CY30. However, India is currently in an "Absent" phase in wafer fabrication, with an aspiration to reach "Pilot-Scale" by then.

The country's OSAT/ATMP (Other Semiconductor Equipment/Assembly/Testing/Mounting) infrastructure is in an "Emerging" state and is targeted to become "Scaled" by 2030.

The report identifies several key enablers to support this transition, including the Chip-to-Startup (C2S) program, Design Linked Incentive (DLI), Global Capability Centres (GCCs), and government support for semiconductor projects. The Tata-PSMC Dholera 28nm fab and partnerships with industry giants such as Micron, Tata, Kaynes, and CG Semi are expected to strengthen India's semiconductor manufacturing and packaging ecosystem.

In addition, India's OSAT costs are estimated to be 20-30% lower than its competitors, providing a substantial advantage in cost competitiveness.

End-market demand for semiconductors is also a crucial factor in this growth trajectory. The report highlights key drivers such as 5G, electric vehicles, defense applications, and AI data centers. It estimates that India's semiconductor end-market will amount to approximately USD 103 billion by 2030. However, India currently relies on imports for various semiconductor-related inputs, including equipment, specialty chemicals, electronic-grade gases, silicon wafers, and substrates/lead frames.