NITI AAYOG RELEASES “FUTURE OF INDIA’S SEMICONDUCTOR INDUSTRY” ROADMAP

Why In News?

NITI Aayog’s Frontier Tech Hub launches India’s first comprehensive 10-year roadmap to establish a self-reliant semiconductor ecosystem.   

Highlights of the Future of India’s Semiconductor Industry

The NITI Aayog report "Future of India’s Semiconductor Industry", outlining India's strategic path toward technological sovereignty and a USD 120-150 billion semiconductor value chain by 2035.

Key Economic Targets

Strategic Objectives

Global Leadership: Become a top-three destination for Outsourced Semiconductor Assembly and Test (OSAT) and Advanced Packaging.

Manufacturing Dominance: Secure leadership in mature-node logic, specialty analog, and compound semiconductors (Silicon Carbide - SiC and Gallium Nitride - GaN).

Design Sovereignty: Leverage India’s 20% share of the global semiconductor design workforce to create over 100 advanced semiconductor design IPs.

Material Supply: Emerge as a trusted supplier of wide-bandgap materials and critical semiconductor chemicals.

The Five Strategic Pillars of India's Roadmap

India organizes its national mission around five mutually reinforcing pillars to strengthen the indigenous ecosystem.

Pioneering (R&D and IP)

• Establish a National Frontier Semiconductor Research Programme.
• Launch a Strategic Semiconductor IP and Patent Programme to build domestic ownership.
• Deploy an AI-Enabled Semiconductor Engineering Mission to accelerate design cycles.
• Provide sovereign access to Electronic Design Automation (EDA) and Multi-Project Wafer (MPW) infrastructure.

Policy and Investment

• Maintain institutional governance and policy stability to attract long-term capital.
• Implement a Full Stack Incentive and risk-sharing regime under ISM 2.0.
• Create a National Semiconductor Capital Framework to mobilize funding for high-capex projects.
• Drive demand creation through market anchoring in domestic sectors like automotive and telecom.

Production

• Focus on Wafer Fabrication where India has a structural advantage (mature nodes and specialty chips).
• Prioritize Advanced Packaging (chiplets, 2.5D/3D integration) as a national differentiator.
• Secure upstream manufacturing, including materials and substrates.
• Enable export-oriented production to integrate into global supply chains.

People (Talent Development)

• Build a National Semiconductor Talent Pyramid to address all levels of the value chain.
• Develop a Fab-Ready Technician Pipeline to ensure operational reliability of manufacturing plants.
• Focus on specialized engineering talent for Design, Manufacturing, and Advanced Packaging.
• Attract global experts through a Global Talent Infusion program.

Partnership

• Forge Strategic Geopolitical Partnerships with "trusted nations" (US, Japan, EU).
• Establish Critical Minerals and upstream resource partnerships to secure raw materials.
• Link academia and industry through Talent and Institutional Partnerships.

The "Semiconductor Imperative": Why India Must Act Now

NITI Aayog identifies four critical drivers for immediate action:

• Significant Import Dependence: Currently, 90-95% of India’s semiconductor consumption is met through imports.
• Drain on Forex: India spent nearly USD 150 billion on semiconductor imports between FY17-FY25. Without domestic production, this cost could rise to USD 240 billion annually by 2035.
• National Security Risk: Reliance on "black-box" foreign technology for UAVs, naval, and airborne platforms poses a threat to strategic autonomy.
• Societal Upliftment: Domestic chip production lowers the cost of 5G/6G devices, enabling remote healthcare, smart agriculture, and rural connectivity.

ISM 2.0: Deepening the Ecosystem

Announced in the Union Budget 2026-27, India Semiconductor Mission (ISM) 2.0 marks a transition from ecosystem initiation to ecosystem deepening.

• Priority Shift: Places design as the "clear number one priority."
• Infrastructure: Focuses on the first fabrication facility at Dholera and new investments in assembly and testing.
• Strategic Leapfrogging: Directly targets emerging technologies like chiplets, heterogeneous integration, and system-level design to bypass legacy manufacturing hurdles.

Conclusion

India must convert semiconductors from a strategic vulnerability into a source of national strength by establishing itself as an indispensable, top-tier global hub for design, advanced packaging, and specialty manufacturing by 2035.

Source: pib