India's Tier-2 Cities Poised to Transform Semiconductor Landscape

India's semiconductor industry is witnessing a strategic shift as tier-2 cities like Ahmedabad, Mohali, and Thiruvananthapuram emerge as crucial components in the nation's semiconductor roadmap for the next decade. According to a report by Quess Corp Limited, early investors are set to benefit from policy-driven incentives and cost advantages, while also aiding in reducing the country's reliance on already saturated tier-1 hubs.

In a bid to diversify its semiconductor ecosystem, the Indian government has approved four new projects under the India Semiconductor Mission (ISM). These initiatives, located across Odisha, Andhra Pradesh, and Punjab, will establish semiconductor manufacturing facilities with a combined investment of approximately Rs 4,600 crore, creating over 2,000 skilled jobs. This development brings the total number of ISM-approved projects to 10, spanning six states with total investments of around Rs 1.60 lakh crore.

The report, titled 'The Chip Catalyst: India's Emerging Semiconductor Ecosystem,' highlights the resilient growth of India's semiconductor market, projected to reach USD 54.3 billion by 2025 and USD 103.5 billion by 2030 with a 13.8 per cent CAGR. This rise is driven by accelerated demand for chips in electric vehicles, 5G infrastructures, and expanding data centers. Structural investments and regional initiatives are empowering tier-2 cities to spearhead this technological expansion.

(With inputs from agencies.)