Stories
AI Boom, Supply Chain Shifts Create Massive Opportunity for India's Chip Sector: BCG
- •India's growing electronics consumption, government incentives, and global supply chain shifts are creating a strong opportunity for a domestic chip ecosystem, according to BCG's Ankush Wadhera.
- •Wadhera believes the AI boom will continue to drive demand for GPUs, compute, and memory, strengthening the semiconductor-AI linkage.
- •India's geopolitical stability, numerous FTAs, and soft power make it an attractive location for the semiconductor supply chain.
- •Strong domestic demand and government policies like ISM 1.0 and 2.0 are attracting significant investment and expanding incentives in the sector.
- •The government has committed ’1.27 lakh crore under the second phase of the semiconductor program, attracting major investments from companies like Applied Materials, Lam Research, and Tata Electronics.
Key Questions Answered
Under the second phase of the semiconductor programme, the Indian government has committed Rs 1.27 lakh crore, attracting major investments such as Applied Materials' USD 5 billion plan through 2035, Lam Research's Rs 10,000-crore investment, Tata Electronics' vendor park at Dholera, and Fujifilm's semiconductor materials plant.
Boston Consulting Group Managing Director Ankush Wadhera views recent discussions around responsible AI development as helpful speed breakers rather than stop signs that would slow down the semiconductor sector. He expects the AI boom to persistently drive demand for compute power, memory, and GPUs, strengthening the linkage between AI and semiconductors.
According to Electronics and IT Minister Ashwini Vaishnaw, India aims for its domestic semiconductor capabilities to reach into everyday products such as refrigerators, televisions, and cars, as well as critical power infrastructure in the coming years.
