India to become a global leader in ER&D sourcing by FY30

The report titled “Seizing the ER&D Advantage: Frontiers for 2030,” launched by NASSCOM in partnership with BCG, provides insights into India’s position and potential in the global Engineering Research and Development (ER&D) sourcing market.

Here are the key highlights and takeaways from the report:

  • India’s Position in ER&D Sourcing: India is considered a preferred destination for global ER&D sourcing. This preference is driven by several factors, including a vast pool of digital talent, a robust ecosystem, and a mature ER&D industry. It is projected that India will contribute 22 percent to the global ER&D sourcing market by the fiscal year 2030.
  • Key Sectors: The report identifies that the software, automotive, and semiconductor sectors are expected to contribute over 60 percent of India’s share of ER&D sourcing by fiscal year 2030.
  • Collaboration is Key: Collaboration among government, industry, and academia is seen as pivotal for India’s continued growth in the ER&D sector. It is important to establish robust infrastructure, craft effective policies, enhance ER&D skillsets, and provide industry-specific training to ensure employability and high-quality research.
  • India’s Role in ER&D Acceleration: India is expected to play a significant role in driving next-generation ER&D across sectors such as Automotive (xEV, Connected Vehicles, Infotainment), Energy, Utilities, Oil and Gas (Climate and Sustainability, Digital Operations), and MedTech (Remote Patient Monitoring Devices, Advanced Imaging). This is projected to increase India’s ER&D contribution from an estimated US$ 45 billion in 2023 to nearly US$ 150 billion by 2030.


  • Global ER&D Growth: Globally, ER&D spending is expected to grow at a compound annual growth rate (CAGR) of 8-9 percent from 2023 to 2030, reaching a market size of US$ 1.8 trillion. Key contributors to this growth are anticipated to be the automotive, software, healthcare, and medical devices sectors, with digital engineering playing a primary role.
  • Semiconductor ER&D: Semiconductor ER&D sourcing in India is expected to see significant growth, driven by the global push to use India as a base for semiconductor manufacturing. This is likely to make India a consolidated design and manufacturing ecosystem for semiconductors.
  • Key Growth Challenges for India: The report identifies two key growth challenges for India’s ER&D sector: Skills Synchronicity and Emerging Geo Contenders. Addressing these challenges requires a focus on identifying necessary ER&D skillsets, developing an ecosystem for skill training at scale, and enhancing India’s global competitiveness.
  • Growth Imperatives: The report outlines three key growth imperatives to foster a larger and more diversified ER&D segment in India. These include improving policy and infrastructure, supporting branding and marketing efforts, and building a collaborative environment between industry, academia, and the government to improve talent employability and research quality.

In summary, the report emphasizes India’s unique position in the global ER&D sourcing market and outlines key strategies and imperatives to harness its potential for growth in this sector. Collaboration, skill development, and policy support are highlighted as crucial elements for India’s continued success in ER&D.


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