- India spent $150 billion on semiconductor imports between FY17 and FY25, says NITI Aayog
- Annual chip import costs could reach $240 billion by 2035 without domestic production growth
- Reducing import reliance is key for sectors like automobiles, telecom, defense, and AI systems
India's dependence on imported semiconductor products has resulted in a massive foreign exchange outflow of nearly $150 billion over the last nine years, according to a new NITI Aayog report that warns the country's chip import bill could rise sharply over the next decade.
The report, Future of India's Semiconductor Industry, said India spent around $150 billion importing semiconductor products between FY17 and FY25, underlining the country's deep reliance on overseas chip supply chains.
That import burden is expected to rise significantly, with annual semiconductor import costs projected to touch nearly $240 billion by 2035 if domestic manufacturing capacity is not scaled up in time.
NITI Aayog said reducing import dependence must become a central objective of India's semiconductor strategy, particularly as chips increasingly become foundational to sectors such as automobiles, telecom, industrial electronics, defence, AI systems and consumer devices.
The report argued that India's manufacturing strategy should focus on segments where the country has structural advantages and can rapidly substitute imports without taking on unsustainable capital exposure.
It recommended prioritising mature-node fabs, compound semiconductors, advanced packaging, OSAT facilities and semiconductor materials manufacturing to build resilience across the domestic supply chain.
NITI Aayog also warned that semiconductor technologies are increasingly shaped by geopolitics, export controls and national security considerations, making trusted supply-chain partnerships critical for India's long-term economic and strategic interests.
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