Report Forecasts India's Semiconductor Market to Reach $155 Billion by 2031, Global Consumption Share Rising to 9%

en.Wedoany.com Reported - Kotak Mahindra Mutual Fund released a report on August 24 stating that India's semiconductor market is expected to reach $155 billion by 2031, with a compound annual growth rate (CAGR) of 20%. By then, India's share of global semiconductor consumption is projected to rise from approximately 6% to about 9%.

The report notes that opportunities in India's semiconductor market are being driven by domestic demand, a growing chip design ecosystem, government support, and the emergence of manufacturing and packaging capabilities. Currently, India's semiconductor market is valued at approximately $62 billion (2026), accounting for about 6% of global semiconductor consumption.

Chip Design Sector Has Reached Scale, While Manufacturing Capabilities Remain Nascent

The report shows that India's chip design ecosystem has established significant advantages. The country has approximately 300,000 chip design engineers, accounting for about 20% of the global chip design workforce, second only to the United States. The report rates India's current chip design capabilities as "strong" and sets a 2030 target of "leading."

However, in wafer fabrication, India currently remains at a "blank" stage, with a goal of reaching "pilot production" scale by 2030. In the OSAT/ATMP (outsourced semiconductor assembly and test) sector, India is currently in the "emerging" phase, with a target of achieving "scale" by 2030.

Multiple Projects Under Construction Drive Ecosystem Development

The report points out that Tata-PSMC's 28nm wafer fab in Dholera, along with projects involving Micron, Tata, Kaynes, and CG Semi, are expected to strengthen India's semiconductor manufacturing and packaging ecosystem.

India holds cost competitiveness in the semiconductor packaging and testing sector. The report states that India's OSAT costs are estimated to be 20% to 30% lower than comparable regions, with competitive advantages including cost and scale, a vast talent pool, and government capital expenditure support of 50%.

The report also forecasts a significant increase in India's OSAT/ATMP capacity, with target capacity rising from 15 million chips per day in 2026 to 48 million chips per day by 2028, involving projects such as CG Semi, Kaynes Semicon, Tata OSAT, and the HCL Group-Foxconn joint venture.

The report identifies 5G, electric vehicles, defense, and AI data centers as key demand drivers. Supporting policies from the Indian government to facilitate this transformation include the Chip-to-Startup (C2S) program, Design Linked Incentive (DLI), and Global Capability Centers (GCC), among others.