IndiaSemiconductor components market is expected to reach $300 billion in cumulative revenue by 2026, as “Make in India” and production-related incentives (IPL) will drive the local supply of semi-components in the coming years, according to a new report.
The mobile and wearable, IT and industrial segments currently contribute around 80% of semiconductor revenue in the country in 2021.
According to the India Electronics & Semiconductor Association (IESA) report and Search for counterpoint.
“Before this decade is out, there will be nothing that won’t be touched by electronics and the ubiquitous ‘chip’. Whether it’s tackling carbon emissions, renewable energy, security food or health care, the semiconductor chip will be ubiquitous,” said Krishna MoorthyCEO and President, IESA.
The Indian government recently announced an expenditure of 76,000 crore rupees (approximately $10 billion), under its PLI program, separately for the development of an ecosystem of semiconductor manufacturing electronics and screens.
Meanwhile, Maharashtra beat out at least 5 states to win a stupendous investment of Rs 2.06 lakh-crore by the Vedanta Group-Foxconn partnership in semiconductor chip and display fabrications in Pune.
“The gradual shift from feature phones to smartphones has generated increased proportions of advanced logic processors, memory, embedded controllers, sensors and other components. This will continue to drive the value of semiconductor content in smartphones, helped by the rise of wearable devices such as smartwatch and TWS,” explained Tarun Pathak, Research Director at Counterpoint Research.
According to the Vice President of Counterpoint Neil Shahthe next big boom in semiconductor components will come from all sectors.
“However, the telecommunications sector with the advent of 5G and the deployment of fiber network will be a key catalyst in driving the consumption of semiconductor components,” Shah said.
This consumption will come not only from advanced heavy-semiconductor 5G and FTTH network infrastructure equipment, which will contribute more than 14% of total semiconductor consumption in 2026, “but also from high-performance 5G terminals driven by AI, from smartphones, tablets, PCs, connected cars, industrial robotics to private networks,” he said.
In 2021, the Indian end equipment market stood at $119 billion in terms of revenue. It is expected to grow at a CAGR of 19% from 2021 to 2026.
The Electronic Systems Design and Manufacturing (ESDM) sector in India will play a major role in the country’s overall growth, from component sourcing to design manufacturing, according to the report.