New Delhi [India], September 19 : India’s semiconductor market is projected to reach USD 200 billion by 2035 from around USD 64 billion in 2026, as the country moves beyond building manufacturing capacity towards developing an integrated semiconductor ecosystem, according to a report by EY and the India Electronics and Semiconductor Association (IESA).
The report said India’s semiconductor market has grown from approximately USD 27 billion in 2021 to around USD 64 billion in 2026. The expansion, coupled with global supply-chain realignment and growing demand for semiconductors across AI, digital infrastructure, mobility and advanced manufacturing, is creating an opportunity for India to deepen its participation in global semiconductor value chains. 
India Semiconductor Mission (ISM) 1.0, launched with an outlay of Rs 76,000 crore, has resulted in the approval of 12 semiconductor manufacturing projects, involving cumulative investments of approximately Rs 1.64 lakh crore. These include one silicon fab, two compound semiconductor fabs and nine packaging facilities.
The programme has also resulted in 23 chip tape-outs, while three semiconductor units have commenced production and exports, according to the report. India now accounts for nearly 20 per cent of the global semiconductor design talent pool, strengthening its position in the design segment. 
Building on this foundation, the government launched Semicon India 2.0 in July 2026 with an enhanced outlay of Rs 1,27,500 crore. The second phase adopts a six-pillar approach covering design, semiconductor materials and equipment, fabrication, advanced packaging, research and development, and talent creation.
The report said Semicon 2.0 is intended to expand support beyond fabs and packaging to areas such as semiconductor-grade materials, specialty chemicals, gases, substrates, equipment, testing infrastructure and design commercialisation. It also provides support for R&D and talent development. 
The report said the next phase of India’s semiconductor journey would depend on the ability to translate policy momentum into integrated ecosystem capabilities, with execution, innovation, localisation and capability development emerging as key priorities.