India's Tier-2 Cities: The Future Pillars of Semiconductor Growth

In a significant shift, early investors in India's tier-2 semiconductor sector are poised for substantial gains, driven by policy incentives and cost benefits. As tier-1 cities grapple with saturation and attrition, tier-2 cities are emerging as essential components of India's semiconductor growth plan for the next decade, according to a report by Quess Corp Limited.

The central government has recently approved four additional semiconductor projects under the India Semiconductor Mission (ISM), expanding its footprint in Odisha, Andhra Pradesh, and Punjab. These new projects, with a cumulative investment of approximately Rs 4,600 crore, aim to generate over 2,000 skilled jobs, showcasing India's efforts to bolster its semiconductor infrastructure.

Featured in the report titled 'The Chip Catalyst: India's Emerging Semiconductor Ecosystem,' it highlights India's growing role in the global semiconductor supply chain amidst geopolitical tensions and supply constraints. Projections for India's semiconductor market are positive, with an estimated USD 54.3 billion by 2025, expected to rise significantly by 2030.

The semiconductor boom is closely linked to daily-use electronic devices but is increasingly driven by innovations like electric vehicles and 5G technologies. The India Semiconductor Mission is spearheading domestic capability building with extensive investments, facilitating the rise of tier-2 clusters as vital semiconductor hubs.

With over 250,000 semiconductor professionals and an expanding workforce, India is set to become a global leader in semiconductor talent. As traditional hubs like Bengaluru and Hyderabad face expansion challenges, tier-2 cities are rapidly becoming key players in aligning semiconductor initiatives with India's broader technological ambitions.

(With inputs from agencies.)