NITI Aayog calls for massive chip sector push
India should target building a USD 120-150 billion semiconductor value chain by choosing leadership and purpose over participation by 2035, a NITI Aayog report said on Friday. The Centre should commit at least one-third of the required investment to de-risk projects and anchor long-term investor confidence, the report, ‘Future of India’s Semiconductor Industry‘, suggested.
Instead of chasing the global wafer race from behind, India should define its own pathway-one that is not only distinct but shaped by strategic self-sufficiency, ecosystem strength, and global indispensability, the report said. “By 2035, India should target building a USD 120-150 billion semiconductor value chain by choosing leadership and purpose over participation,” the report said.
According to the report, building a globally competitive semiconductor ecosystem in India will require nearly USD 135–180 billion in cumulative semiconductor investments over the next decade, directed toward growth capital across design, fabrication, advanced packaging, materials, and supporting infrastructure. “The Government of India should commit at least one-third of the required investment to de-risk projects and anchor long-term investor confidence,” it said.
This, the report said in turn, can crowd in private capital at scale. Fabs, advanced packaging, compound semiconductors, and critical design infrastructure should be prioritised for public funding. “Alongside funding support, the focus should also be on stability, predictable incentives, and coordinated execution across the value chain,” it said. According to the report, the country’s semiconductor market is projected to reach around USD 200 billion by 2035.
However, despite the growing domestic demand, nearly 90–95 percent of this demand is currently met through imports, leading to large foreign exchange outflows and increasing the vulnerability of critical sectors to supply-chain disruptions, it pointed out. “This widening gap between demand growth and limited domestic capability represents a critical strategic vulnerability and yet also a historic opportunity,” the report said.
NITI Aayog Vice Chairman Ashok Kumar Lahiri, in his message, said one of the biggest strategic risks to Viksit Bharat is a growing dependence on imported black-box technologies. “For India to become a developed nation, technological sovereignty is foundational. And that sovereignty must begin at the infrastructure layer. Semiconductors sit at the heart of this foundation, powering everything from AI, defence and manufacturing to mobility, energy systems, communications and citizen services,” Lahiri added.
Semiconductors sit at the core of modern economic power. They serve as the critical backbone powering artificial intelligence, telecommunications, electric mobility, defence systems, healthcare technologies, and digital public infrastructure. The report said that given their pivotal role in technology-driven advancements, semiconductors are not just strategic assets but central to economic resilience and national security.
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