India Must Build $120-150 Billion Chip Value Chain: NITI Aayog
NITI Aayog stated that India aims to establish a semiconductor value chain worth $120-150 billion by 2035, with the Centre pledging to invest at least one-third of the necessary funding to mitigate risks and foster long-term investor confidence.
To significantly enhance India's electronics manufacturing presence and ensure technological independence, NITI Aayog's Frontier Tech Hub unveiled the strategic plan called “Future of India’s Semiconductor Industry” in May 2026. The report outlines a step-by-step plan to transition India from a downstream user of semiconductors to an essential part of the global value chain.
The roadmap follows closely after the Union Budget 2026 declaration of ISM 2.0 (India Semiconductor Mission), indicating a strategic transition from building ecosystems to enhancing and expanding capabilities.
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Instead of directly competing in the pursuit of advanced foundry nodes, the report recommends a distinct "More-than-Moore" strategy that capitalizes on India’s advantages in chip design and emphasizes high-growth niche markets.
The report estimates that by 2035, India might secure 10-13 percent of the worldwide semiconductor market, concurrently nurturing a domestic semiconductor sector worth around $200 billion. It also aims for 35-50 percent self-sufficiency in semiconductor demand and seeks to keep 55-70 percent of value capture domestically through local design, packaging, and materials ecosystems.
India aspires to position itself among the top three global hubs for Outsourced Semiconductor Assembly and Test (OSAT) and advanced packaging, while establishing a leadership role in AI, quantum computing, and high-performance computing chip design with over 100 advanced intellectual properties (IPs).
Ashok Kumar Lahiri, the Vice Chairman of NITI Aayog, noted that increasing reliance on imported black-box technologies presents a significant strategic threat to the Viksit Bharat vision, emphasizing that technological sovereignty should start with the infrastructure layer.
The approach revolves around five key elements — Innovation, Regulation and Funding, Manufacturing, Workforce, and Collaboration — aimed at addressing fundamental issues like capital demands, workforce deficiencies, and extended development timelines.
Within the Pioneering pillar, the report recommends tiered subsidies for Electronic Design Automation (EDA) tools, a National Design and Packaging Co-Design Platform, and an AI-driven Semiconductor Engineering Mission focused on reducing chip design cycles using autonomous AI.
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For Policy and Investment, the roadmap anticipates that India will need total investments ranging from USD 135-180 billion in the coming ten years. It suggests that the government contribute about a third of this total — approximately $45-60 billion — via a specific Semiconductor Support Fund to attract private investment.
The Production strategy emphasizes focused depth instead of extensive duplication of the worldwide manufacturing network. India intends to concentrate wafer fabrication initiatives on mature logic process nodes ranging from 28 nm to 65 nm, as well as specialty analog chips utilized in automotive, IoT, and power management sectors.
The report additionally emphasizes prospects in wide-bandgap semiconductor materials like Silicon Carbide (SiC) and Gallium Nitride (GaN). To meet the significant energy demands of the sector, it suggests investigating Small Modular Reactors (SMRs) for a dedicated nuclear energy source for semiconductor manufacturing clusters.
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Regarding personnel, the plan outlines a four-tier National Semiconductor Talent Pyramid. It suggests establishing a National Fab Academy with industry professionals to educate technicians prepared for cleanrooms and enhancing engineering programs to emphasize tape-out and package-aware validation abilities.