India's digital economy is growing 2.8x of GDP: Rajeev Chandrasekhar

India's digital economy is growing at a rate of almost three times the overall GDP growth and will constitute one-fifth of the total economic activity by 2027, said Union Minister Rajeev Chandrasekhar on Monday.

Speaking at an event in New Delhi, the Minister of State for Electronics and IT said, "The digital economy in India today is growing at 2.8x the regular GDP. It was 4.5 per cent of GDP in 2014, it is 12 per cent of GDP today, and it will be a fifth of the GDP by 2026-27."

The areas of focus for the next government, if elected, will be electronics and micro-electronics, protection intelligence, telecom, high-performance computing, semiconductors, cybersecurity, the future of the internet, and areas like automotive and EVs, said the minister.

 

"We are already the fastest-growing digital economy in the world, and for me, it is clear that we are aiming for a $1 trillion digital economy by 2027-28," he further added.

Chandrasekhar said that the Prime Minister is keen on investing further in public and private capital flow to the digital space.

Speaking at the recently concluded CII Annual Business Summit 2024, MeitY Secretary S Krishnan said that under the India AI Mission, the centre is planning to provide fiscal support to entities that create compute infrastructure in the country. The financial support will be up to 50 per cent of the total cost of setting up GPU infrastructure.

“The target is to establish at least 10,000 GPUs worth of AI compute capacity in the country, and for this, the government is prepared to provide for a significant increase of up to about 50 per cent of the cost of creating this infrastructure.”

“In order to speed up the entire process, the idea is to partner with a variety of private institutions so that we are able to work with the private sector in making this capacity available quickly,” he added.

In the past few months, the government has also focused on ramping up capabilities within India to cater to the semiconductor demand in the country and also making it a part of the global supply chain.

This has included the Tata group announcing the establishment of the country’s first fab manufacturing unit in partnership with Taiwan’s Powerchip Semiconductor Manufacturing Corporation (PSMC) in Dholera, Gujarat. CG Power and Industrial Solutions Limited, under the Modified Scheme for Semiconductor Assembly, Testing, Marking and Packaging (ATMP), is coming up with outsourced semiconductor assembly and test facilities (OSAT) in Gujarat. Tata will also be setting up an OSAT plant in Assam.