India Semiconductor Manufacturing Equipment Market Size, Share & Trends Analysis Report By Type (Wafer Processing/Wafer Manufacturing, Assembly and Testing Equipment, Other), By Application (Fabrication Plant/Foundry, Semiconductor Electronics Manufacturer, Testing Home), By Dimension (2D, 3D) and Forecasts, 2025-2033

India Semiconductor Manufacturing Equipment Market Size

The India semiconductor manufacturing equipment market size was valued at USD 17,934.89 million in 2024 and is projected to grow from USD 19,137.10 million in 2025 to USD 34,853.29 million by 2033, with a CAGR of 6.9% during the forecast period (2025-2033).

This growth is driven by increasing domestic demand for semiconductor components, governmental initiatives to bolster local manufacturing, and a growing focus on advanced technologies, including AI and IoT. Additionally, India's emerging semiconductor ecosystem, bolstered by investments from global tech giants, is positioning the country as a significant player in the semiconductor landscape.

Market Drivers

Government Initiatives and Investment

The Indian government has introduced various initiatives to promote the semiconductor manufacturing sector, aiming to make India a global hub for electronics manufacturing. The Production-Linked Incentive (PLI) scheme has allocated around USD 10 billion to support the semiconductor industry, aiming to attract investments and encourage domestic production.

Additionally, the "National Policy on Electronics" aims to achieve a USD 300 billion electronics manufacturing industry by 2025, creating a favorable environment for semiconductor production. These initiatives are expected to enhance India's competitiveness in semiconductor manufacturing and reduce dependency on imports, stimulating market growth. According to the Ministry of Electronics and Information Technology, India aims to produce 1,000 semiconductor fabs by 2025, emphasizing the government's commitment to fostering this critical industry.

Market Restraint

Infrastructure Challenges

The Indian semiconductor manufacturing sector faces significant infrastructure challenges. The country’s manufacturing infrastructure is often outdated, leading to inefficient production processes. Issues such as inadequate supply chain logistics, inconsistent power supply, and lack of specialized facilities for semiconductor fabrication hinder growth.

Moreover, more access to advanced technology and skilled labor is needed to grow the establishment of new semiconductor manufacturing units. According to a report by the National Association of Software and Service Companies (NASSCOM), around 70% of semiconductor manufacturing is concentrated in a few established players, highlighting the challenges faced by new entrants in scaling operations.

Market Opportunities

Growing Demand for Advanced Technologies

India’s increasing demand for advanced technologies, particularly in sectors like automotive, consumer electronics, and telecommunications, presents significant opportunities for the semiconductor manufacturing market. The rising adoption of electric vehicles (EVs) and the shift towards Industry 4.0 propel the demand for semiconductor components, especially microcontrollers and sensors. With a burgeoning start-up ecosystem focused on semiconductor innovations, India has the potential to develop cutting-edge technologies.

Furthermore, global players like Intel and TSMC are investing in Indian semiconductor facilities, which will contribute to the sector's overall growth. According to a report from the Semiconductor Industry Association, the global semiconductor market is expected to reach $1 trillion by 2030, and India aims to capture a substantial share of this growth.

Regional Insights

The market is characterized by a rapidly evolving semiconductor ecosystem across several key cities in India, each contributing to the sector's growth. Although a relatively new entrant, India is quickly developing its semiconductor ecosystem. The Indian government’s Production Linked Incentive (PLI) Scheme aims to attract foreign semiconductor manufacturers, with plans to establish multiple fabs.

Bengaluru, known as the "Silicon Valley of India," is a significant semiconductor research and development hub. The city is home to several leading technology companies and start-ups, fostering an innovation-driven environment. Companies like Intel, Texas Instruments, and Qualcomm have established significant operations here, focusing on R&D and semiconductor design. The city's skilled workforce and robust infrastructure support the growth of the semiconductor sector.

Hyderabad is emerging as a significant player in semiconductor manufacturing, with major companies such as Micron and AMD setting up facilities. The city benefits from strong government support and initiatives to attract semiconductor investments. The presence of research institutions and engineering colleges provides a steady stream of skilled talent, enhancing the region's capabilities in semiconductor technology.

Chennai has a well-established electronics manufacturing ecosystem supported by several semiconductor companies, including ON Semiconductor and STMicroelectronics. The city's strategic location and connectivity facilitate efficient supply chain logistics, attracting investments in semiconductor manufacturing. The growing demand for consumer electronics in the region further boosts the semiconductor market.

Pune is rapidly becoming a center for semiconductor and electronics manufacturing, driven by investments from global players like Bosch and Tata. The city has a robust talent pool and is known for its engineering colleges, supporting the semiconductor industry's growth. The government has also introduced incentives to promote manufacturing in the region.

Noida, part of the National Capital Region (NCR), is witnessing significant growth in the semiconductor manufacturing sector, with companies like HCL and Tech Mahindra investing heavily in semiconductor R&D. The region's proximity to Delhi and established infrastructure make it an attractive location for tech companies and semiconductor fabs.

Segmental Analysis

By Type

Wafer Processing/Wafer Manufacturing dominates the type segment and is expected to grow at a CAGR of 6.8% over the forecast period. The increasing demand for high-performance chips and advancements in fabrication techniques are driving this growth. The establishment of semiconductor fabs in India, supported by government initiatives, will further enhance wafer processing capabilities. Companies like Micron and Intel are investing in wafer manufacturing facilities, contributing to the sector's growth.

By Application

Fabrication Plant/Foundry dominates the application segment and is expected to grow at a CAGR of 6.8% during the forecast period. This segment's growth is primarily driven by government incentives to establish semiconductor foundries in India. The establishment of the PLI scheme has encouraged domestic and international companies to invest in fabrication plants. Major players such as GlobalFoundries and Samsung are exploring opportunities to set up foundries in India, enhancing the country's production capacity.

By Dimension

The 2D segment dominates the dimension segment and is expected to grow at a CAGR of 6.4% as India increasingly focuses on next-generation semiconductor materials. The adoption of 2D materials like graphene and transition metal dichalcogenides is gaining traction due to their superior electrical properties. Indian research institutions and universities are conducting significant research into 2D semiconductor applications, leading to innovations that can be leveraged in various sectors.

Analyst's Perspective

As per our analyst, the India semiconductor manufacturing equipment market is poised for rapid expansion in the coming years. This growth is primarily driven by India's strategic initiatives to strengthen its semiconductor manufacturing capabilities, coupled with a surge in demand for electronics across various sectors. The government’s commitment to enhancing domestic manufacturing through the PLI scheme and other incentives is creating a conducive environment for investments. The ongoing collaboration between research institutions and the private sector will lead to innovations that will enhance India’s competitiveness in the global semiconductor market. While infrastructure and skilled labor challenges remain, the overall outlook for the Indian semiconductor manufacturing equipment market is optimistic, with substantial growth opportunities ahead.