Application-Specific Integrated Circuit Market in India

Application-Specific Integrated Circuit in India Trends and Forecast

The future of the application-specific integrated circuit market in India looks promising with opportunities in the telecommunication, industrial, automotive, and consumer electronic markets. The global application-specific integrated circuit market is expected to reach an estimated $21.8 billion by 2031 with a CAGR of 5.7% from 2025 to 2031. The application-specific integrated circuit market in India is also forecasted to witness strong growth over the forecast period. The major drivers for this market are the rising need for specialized and high-capacity chips and the widespread integration of artificial intelligence and machine learning among industries.

• Lucintel forecasts that, within the product type category, semi-custom will remain the largest segment over the forecast period due to its lower complexity and broad range of applications.
• Within the application category, consumer electronics is expected to witness the highest growth due to the increasing use of application-specific integrated circuits in various gadgets, such as smartphones, tablets, and laptops.

Emerging Trends in the Application-Specific Integrated Circuit Market in India

The increasing investment in telecommunications, automotive, and healthcare sectors in India has significantly impacted the growth of the application-specific integrated circuit (ASIC) market. As industries aim for greater efficiency, energy savings, and performance, the current semiconductors available are insufficient. There is an increasing demand for customized semiconductors designed to handle specific tasks. In light of emerging technologies and shifting market demands, several new trends have emerged. These trends highlight India’s growing capability to design and manufacture semiconductors, fostering innovation and contributing to the growth of the ASIC industry.

• Increased Investment in Energy-Efficient ASICs: Investment in energy-efficient ASICs has risen to address power shortages, placing a greater emphasis on sustainability. Industries in India, including telecommunications, automotive, and renewable energy, are focusing on energy-efficient solutions. ASICs are seen as a critical tool for reducing energy consumption across various sectors. As green technologies like electric vehicles and smart cities become more prevalent, the demand for power-efficient ASICs continues to grow. This has led Indian manufacturers to prioritize power-saving designs to optimize energy-consuming applications.
• Expansion of 5G Infrastructure: India is rapidly adopting 5G technology, which is driving the demand for high-performance ASICs. These custom chips are crucial for supporting 5G networks, improving data transmission, reducing network latency, and optimizing overall performance. As 5G technology rolls out, there are more opportunities for ASIC designers to specialize in telecom-related chips. With substantial investments in 5G infrastructure, the demand for tailored ASICs will increase, further fueling market growth in India.
• Growth in the Automotive Sector: India’s automotive industry is undergoing a major transformation with the rise of electric vehicles (EVs) and autonomous driving applications. This shift has increased the need for ASICs in battery management, power control, and navigation systems. The growing focus on EV adoption and self-driving vehicles offers substantial opportunities for ASIC manufacturers to design chips that enhance energy efficiency, safety, and performance in vehicles. The expansion of electric mobility and connected vehicles is set to reshape the market, creating new opportunities for ASIC designs in the automotive industry.
• Progression of Artificial Intelligence (AI) and Machine Learning: The growing infrastructure for Artificial Intelligence (AI) and Machine Learning (ML) in India has led to an increased demand for high-performance ASICs capable of handling data processing, deep learning, and algorithmic computations. Sectors such as healthcare, finance, and manufacturing are increasingly utilizing AI technologies for automation and decision-making. The need for customized AI workload ASICs to achieve faster calculations while reducing power consumption is critical to support these advancements. The continued growth of AI in India will drive the demand for specialized ASICs, supporting the development of the market.
• Policy Initiatives and Government Support: The Indian government has implemented several initiatives to support semiconductor manufacturing and the ASIC market. Policies like the PLI Scheme for Semiconductors aim to attract foreign direct investments and boost local production. These efforts are expected to strengthen India’s domestic supply chain for ASICs, reducing reliance on imports. As more investments flow into India’s semiconductor sector, the country’s ASIC market is set to grow, benefiting from increased production capacity and the establishment of new firms in the industry.

The growth of India’s ASIC industry reflects a strong shift towards more refined, energy-efficient, and high-performance semiconductor solutions. These trends are revolutionizing sectors such as telecommunications, automotive, and AI, fostering innovation and creating new market opportunities. Government support, along with increasing demand for customized chips and advancements in 5G, electric vehicles, and AI, positions India’s ASIC market for significant growth. These developments are helping India solidify its place as a global hub for semiconductor design and manufacturing.

Recent Developments in the Application-Specific Integrated Circuit Market in India

India’s ASIC market is evolving rapidly, driven by technological advancements and the increasing demand for specialized semiconductors across various industries. The government’s focus on digitalization, 5G infrastructure, electric vehicles (EVs), and artificial intelligence (AI) has created a conducive environment for ASIC growth. Additionally, the global push to encourage domestic semiconductor manufacturing has made the Indian market more favorable. These developments present strong growth potential for the local ASIC market, offering new opportunities for Indian vendors and fostering international collaboration.

• Government’s Production-Linked Incentive (PLI) Scheme: The Indian government has introduced the PLI Scheme for semiconductors to support domestic semiconductor manufacturing. The scheme provides financial incentives for companies to establish manufacturing plants in India, reducing the country’s reliance on foreign chips. This initiative aims to bolster India’s position as a major player in semiconductor production, creating opportunities for ASIC developers. The PLI scheme is also expected to enhance the local supply chain and foster innovation, further fueling the growth of the ASIC market in India.
• Investment in 5G Infrastructure: India is investing heavily in 5G infrastructure, increasing the demand for advanced ASICs that support high-performance network functions. These custom chips are essential for optimizing data transfer speeds and minimizing network latency in 5G systems. Telecommunication operators and equipment manufacturers in India are increasingly turning to ASICs to meet the technical requirements of 5G. As investment in 5G infrastructure continues, the demand for energy-efficient, cost-effective ASICs is expected to grow, intensifying competition in the market and driving further advancements in semiconductor technology.
• The Growth of Electric Vehicles (EV) Market in India: The rapid growth of the EV market in India has created a significant demand for specialized ASICs used in battery management, power control, and charging systems. As the government pushes for greater EV adoption, automotive manufacturers are increasingly turning to ASICs to improve vehicle energy efficiency and performance. This transition to electric mobility presents a major opportunity for ASIC developers to design custom chips tailored to the specific needs of the Indian EV market. As the EV market expands, the demand for these specialized chips is expected to rise substantially.
• The Growth of Artificial Intelligence (AI) in India: The expansion of AI and machine learning in India has heightened the demand for specialized ASICs capable of handling complex data processing and algorithmic computations. Industries such as healthcare, finance, and manufacturing are integrating AI technologies to automate processes and optimize decision-making. To support these applications, there is a growing need for high-performance, energy-efficient ASICs. The rise of AI in India is driving the need for customized chips that can handle deep learning and neural network operations, contributing to the rapid growth of the ASIC market.
• Focus on Semiconductor Design in India: India is focusing on developing its domestic semiconductor design capabilities, including ASIC design, to meet the growing demand for specialized chips across industries like telecommunications, automotive, and healthcare. Local companies are investing in innovation to reduce dependence on international semiconductor providers. This shift towards self-sufficiency is expected to enhance India’s position in the global semiconductor market. Furthermore, foreign semiconductor manufacturers are increasing their engagement with India, which will support the expansion of the country’s ASIC market.

The latest developments in India’s ASIC market show a rapid shift toward achieving self-sufficiency in semiconductor design and manufacturing. Government support, alongside the growing investments in 5G infrastructure, electric vehicles, and AI, is driving the demand for economy-specific semiconductors. As a result, the market is undergoing significant changes, allowing local firms to design and produce sophisticated chips that meet the needs of India’s technology-driven industries. With continued investment in semiconductor fabrication and research and development, India is set to become a global leader in the ASIC market.

Strategic Growth Opportunities for Application-Specific Integrated Circuit Market in India

Advanced technologies, support from the government, and market needs are fueling growth in India’s application-specific integrated circuit (ASIC) market. With the advancement of specialized semiconductor solutions across telecommunications, automotive, healthcare, and AI, growth is inevitable. Thus, manufacturers of ASICs can expect exceptional growth. The following describes the major growth opportunities within the Indian ASIC landscape, targeting distinct sectors, and reveal how these sectors create demand.

• Telecommunications and 5G Infrastructure: The immediate launch of 5G technology in India has escalated the demand in the ASIC market. Custom-designed for the telecommunications industry, these chips optimize data transmission and speed. Additionally, they reduce network latency to elevate the performance of telecom networks. Consequently, as India moves toward the adoption of 5G infrastructure, there will be a boom in the demand for custom-designed telecommunications ASICs. Telecom operators will experience smooth and fast 5G service, leading to better customer satisfaction. This is the time for manufacturers of these custom-designed telecom ASICs.
• Automotive Industry and Electric Vehicles: The accelerating adoption of electric vehicles (EVs) in India suggests a promising market opportunity for manufacturers of application-specific integrated circuits (ASICs). The active market shift in India’s automobile industry towards electric and self-driving vehicles will require chips for battery and energy management, system efficiency, and power control. These chips will help optimize vehicle performance, safety, and battery life. EVs will create a need for relevant ASIC designs based on their customized system demands, and growth in these sectors is expected in the upcoming years, thanks to innovation in chip design.
• Artificial Intelligence and Machine Learning: The new focus on artificial intelligence (AI) and machine learning is proving to be a boon for India’s economy and offers a wide market for ASIC manufacturers to capture such opportunities. The AI and ML industry is booming and requires powerful AI chips that can process huge datasets with complex algorithms while conserving energy. As AI penetrates more industries like healthcare, manufacturing, and finance for automation, optimization, and intelligent decision-making, the demand for AI-centric ASIC designs will be very high. These custom ASICs will facilitate quicker processing with less energy required, which is vital for India’s expanding AI industry.
• Medical Equipment and Healthcare: India’s healthcare industry has started incorporating advanced technologies such as telemedicine, diagnostics, and wearable devices that use specialized ASICs. These chips are essential for other devices such as medical imaging, data monitoring, and robotic surgery, operating with supreme precision and reliability. The shift toward digital technologies across various fields of life, along with India’s booming population, creates a robust need for healthcare-specific ASICs. Manufacturers can develop specialized healthcare ASICs based on stringent predefined health and safety compliance standards, alongside increased operational efficiency and device safety.
• IoT and Consumer Electronics: The expanding and boundless Internet of Things (IoT) ecosystem in India is driving constructive growth in demand for consumer electronics ASICs. The phenomenon of smart homes, wearable devices, and other appliances fuels the demand for sophisticated integration. These IoT system-on-chip (SoC) devices serve different purposes, such as improved communication, better data management, and overall enhanced user interaction. The continual increase of IoT devices within the country, especially in urban regions, will continue to open opportunities for manufacturers to capitalize on new consumer electronics ASICs with increased operational efficiency, decreased energy consumption, and compact designs.

In India, the application-specific integrated circuit (ASIC) market is expanding due to new high-growth opportunities in several important sectors, including telecommunications, automotive, AI, healthcare, and consumer electronics. These opportunities stem from increasing technological innovations and region-specific requirements for high-performance, energy-saving semiconductors. With constant investments in new technologies and infrastructure, India is set to further expand its ASIC market, offering manufacturers multiple areas of growth and focus.

Application-Specific Integrated Circuit Market in India Driver and Challenges

India’s application-specific integrated circuit (ASIC) market is influenced by several technological, economic, and political factors. Several pivotal industries such as telecommunications, automotive, healthcare, and AI are evolving at a rapid pace, which increases the need for advanced custom-built semiconductors. Moreover, the market is also complicated by infrastructure constraints, supply chain challenges, and regulatory problems. The context suggests why studying the key drivers and challenges is essential to understanding where the ASIC market in India is headed.

The factors responsible for driving the application-specific integrated circuit market in India include:
• Government Support and Incentives: The Indian government is working towards developing and supporting the domestic semiconductor industry through a variety of initiatives. For instance, there is a Production-Linked Incentive (PLI) scheme aimed at bringing investment into semiconductor innovation and manufacturing. These policies should decrease import dependency, enhance local production capacities, and position India as a global leader in semiconductor design and manufacturing. The government’s proactive approach to fostering the growth of the semiconductor industry is one of the most significant drivers for the ASIC market.
• Increased Demand for 5G and Telecommunications Infrastructure: India’s ambitious rollout of 5G is one of the strongest drivers of the ASIC market. 5G technology advancements necessitate new generation ASICs with increased data processing capability, decreased latency, and more intricate network functions. With continuous spending on telecom infrastructure by both the government and private sectors, demand for ASICs is trending upwards. To construct the advanced 5G telecom infrastructure required for the country’s digital transformation strategies, these chips are vital. The ramp-up of mobile 5G technology will drive the requirement for telecom industry-specific ASICs.
• Adoption of Electric Vehicles (EVs) and Green Technologies: The move toward electric vehicles (EVs) in the Indian automotive sector is projected to generate a robust requirement for specialized ASICs for power management, battery control, and energy efficiency. Due to the government’s push towards EVs, OEMs are increasingly utilizing ASICs to cater to the high demand for energy-efficient solutions. This shift toward EVs and other green technologies, such as renewable energy systems, provides a strong growth opportunity for ASIC manufacturers, especially those active in the sphere of electric mobility and green technologies.
• Sharp Growth of Artificial Intelligence and Machine Learning: Across different industries in India, AI and machine learning technologies are becoming popular very quickly. The large computational requirements of AI workloads need specialized ASICs for data processing, neural network training, and deep learning. The growing applications of AI in industries like healthcare, finance, and manufacturing are important reasons for the growing demand for ASICs. With India’s evolving status as a major AI player, AI ASICs will become more common in the market, and the power requirements will become more customized.
• Expanding Internet of Things (IoT) Ecosystem: The adoption of IoT technology in India is proliferating and directly increasing the demand for application-specific integrated circuits in consumer electronics, industrial automation, and smart home appliances. Internet of Things devices necessitate small, low-power, highly integrated ASIC chips for data collection, processing, and communication. The growing IoT ecosystem provides an avenue for ASIC microchip designers to create specialized chips for heterogeneous systems in which such devices are interconnected. As the adoption of IoT continues to grow, so will the demand for such custom ICs.

Challenges in the application-specific integrated circuit market in India are:
• Supply Chain and Raw Material Shortages: The pandemic and current geopolitical conditions have already wreaked havoc on the global semiconductor supply chain. The global supply chain woes affect India’s ASIC manufacturers as well, which often results in slower production rates and higher costs. Imported silicon wafers for semiconductor fabrication are one of the primary raw materials, and hence, this further limits the scalability and competitiveness of Indian ASIC companies. To foster the long-term growth of the ASIC market in India, there is a need to ensure stable material supplies along with a robust local supply chain.
• Limited Domestic Semiconductor Manufacturing Capabilities: The country has a burgeoning semiconductor design and development ecosystem but is still heavily reliant on imported chips. This dependency is detrimental to the development of the ASIC market as there are no domestic foundries. Indian companies must rely on overseas facilities for fabrication. To best harness the growing demand for ASICs in the country, India needs to increase its semiconductor manufacturing infrastructure and reduce reliance on foreign facilities for production.
• Regulatory and Policy Hurdles: Although there are initiatives from the government, like the PLI scheme, to make things better, continuously emerging regulatory and policy problems still affect India’s semiconductor sector. Problems such as excessive tariffs on imported equipment, complicated licensing processes, and underdeveloped research and development (R&D) infrastructure could hinder the growth of the ASIC market. Additionally, policy inconsistencies regarding intellectual property rights and technology transfer can hinder Indian manufacturers from competing internationally.

The growth of India’s ASIC market is supported by the government and the increasing demand from key sectors such as 5G, EVs, AI, and IoT. However, this growth is offset by challenges regarding supply chains, manufacturing capabilities, and regulatory requirements. Policies, infrastructure, and manufacturing reforms will shape the strategic environment for the ASIC market. India’s investments in these areas will promote long-term growth and competitiveness in the market.

List of Application-Specific Integrated Circuit Market in India Companies

Companies in the market compete on the basis of product quality offered. Major players in this market focus on expanding their manufacturing facilities, R&D investments, infrastructural development, and leverage integration opportunities across the value chain. Through these strategies, application-specific integrated circuit companies cater to increasing demand, ensure competitive effectiveness, develop innovative products & technologies, reduce production costs, and expand their customer base. Some of the application-specific integrated circuit companies profiled in this report include:
• Company 1
• Company 2
• Company 3
• Company 4
• Company 5
• Company 6
• Company 7
• Company 8
• Company 9
• Company 10

Application-Specific Integrated Circuit Market in India by Segment

The study includes a forecast for the application-specific integrated circuit market in India by product type and application.

Application-Specific Integrated Circuit Market in India by Product Type [Analysis by Value from 2019 to 2031]:

• Full Custom ASIC
• Semi-Custom ASIC
• Programmable ASIC

Application-Specific Integrated Circuit Market in India by Application [Analysis by Value from 2019 to 2031]:

• Telecommunication
• Industrial
• Automotive
• Consumer Electronics
• Others

Features of the Application-Specific Integrated Circuit Market in India

Market Size Estimates: Application-specific integrated circuit in India market size estimation in terms of value ($B).
Trend and Forecast Analysis: Market trends and forecasts by various segments.
Segmentation Analysis: Application-specific integrated circuit in India market size by product type and application in terms of value ($B).
Growth Opportunities: Analysis of growth opportunities in different product type and application for the application-specific integrated circuit in India.
Strategic Analysis: This includes M&A, new product development, and competitive landscape of the application-specific integrated circuit in India.
Analysis of competitive intensity of the industry based on Porter’s Five Forces model.

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FAQ

Q1. What are the major drivers influencing the growth of the application-specific integrated circuit market in India?
Answer: The major drivers for this market are the rising need for specialized and high-capacity chips and the widespread integration of artificial intelligence and machine learning among industries.
Q2. What are the major segments for application-specific integrated circuit market in India?
Answer: The future of the application-specific integrated circuit market in India looks promising with opportunities in the telecommunication, industrial, automotive, and consumer electronic markets.
Q3. Which application-specific integrated circuit market segment in India will be the largest in future?
Answer: Lucintel forecasts that, within the product type category, semi-custom will remain the largest segment over the forecast period due to it’s lower complexity and broad range of applications.
Q4. Do we receive customization in this report?
Answer: Yes, Lucintel provides 10% customization without any additional cost.

This report answers following 10 key questions:

Q.1. What are some of the most promising, high-growth opportunities for the application-specific integrated circuit market in India by product type (full custom ASIC, semi-custom ASIC, and programmable ASIC), and application (telecommunication, industrial, automotive, consumer electronics, and others)?
Q.2. Which segments will grow at a faster pace and why?
Q.3. What are the key factors affecting market dynamics? What are the key challenges and business risks in this market?
Q.4. What are the business risks and competitive threats in this market?
Q.5. What are the emerging trends in this market and the reasons behind them?
Q.6. What are some of the changing demands of customers in the market?
Q.7. What are the new developments in the market? Which companies are leading these developments?
Q.8. Who are the major players in this market? What strategic initiatives are key players pursuing for business growth?
Q.9. What are some of the competing products in this market and how big of a threat do they pose for loss of market share by material or product substitution?
Q.10. What M&A activity has occurred in the last 5 years and what has its impact been on the industry?
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