E-Paper
Sign In
India's semiconductor ambitions grow as chip manufacturing investment accelerates
With billions flowing into new manufacturing facilities, India is building its presence in the global semiconductor industry
- PUBLISHED: Mon 17 Aug 2026, 3:55 PM
India’s semiconductor industry is expanding as the country invests in domestic chip manufacturing and builds on its established strength in semiconductor design. New fabrication, assembly and testing facilities are being developed as part of a wider effort to create a domestic semiconductor ecosystem.
Semiconductors are essential to smartphones, automobiles, medical equipment, telecommunications, data centres, industrial machinery and consumer electronics. Their importance has grown further with the expansion of artificial intelligence, electric vehicles and connected technologies, all of which require increasingly sophisticated chips.
Recommended For You
India already has a significant role in semiconductor design. The country employs nearly 20 per cent of the global semiconductor chip-design workforce and hosts about 7 per cent of the world’s semiconductor-focused Global Capability Centres, according to the Ministry of Electronics and Information Technology. Indian engineers are also working on advanced technologies, including designs at the 2-nanometre level.
Manufacturing capacity, however, remains at an early stage compared with established semiconductor-producing economies. India is now investing across fabrication, assembly, testing and packaging to develop more of the semiconductor value chain within the country.
The Manufacturing Push
The India Semiconductor Mission, launched in 2021, has played a key role in developing the sector. By July 2026, the government had approved 12 semiconductor manufacturing projects with a combined investment of more than ₹1.64 lakh crore. Facilities operated by Micron, Kaynes and CG Semi have also begun commercial operations.
In Gujarat, Micron’s semiconductor assembly and testing facility in Sanand began commercial production and shipments of made-in-India semiconductor memory modules earlier this year.
One of the largest projects is being developed in Dholera, Gujarat, where Tata Electronics is setting up India’s first front-end semiconductor fabrication facility in technology partnership with Taiwan’s Powerchip Semiconductor Manufacturing Corporation (PSMC). The plant, which will have a capacity of around 50,000 wafer starts a month, is being developed with an investment of more than ₹91,000 crore.
In May 2026, Tata Electronics also signed an agreement with Dutch semiconductor equipment company ASML to support the facility. ASML will provide advanced semiconductor manufacturing technology and equipment for the planned 300-mm wafer fabrication plant.
Tata Electronics is also developing a semiconductor assembly and testing facility in Assam, while other projects are taking shape across the country as investment moves into different parts of the supply chain.
These investments are significant because India’s semiconductor presence has traditionally been stronger in design than manufacturing. Building domestic fabrication and packaging capacity would allow the country to participate in a larger part of the global industry.
The expansion also comes as India’s electronics manufacturing industry grows. Rising demand for chips across consumer electronics, automobiles, telecom and industrial applications is creating a sizeable domestic market alongside export opportunities.
Building a Wider Semiconductor Ecosystem
The government expanded its semiconductor programme in July 2026 with the approval of Semicon 2.0, backed by an outlay of around ₹1.27 lakh crore.
The programme covers six areas: chip design, semiconductor equipment and materials, additional fabrication facilities, advanced packaging, research and development, and talent.
Developing these areas will be important because semiconductor manufacturing depends on much more than fabrication plants alone. Chipmakers require specialised machinery, chemicals, materials, design software, packaging facilities and highly trained engineers and technicians.
India is also expanding its chip-design ecosystem. More than 100 start-ups and smaller companies are gaining access to industry-standard design tools, while universities are using electronic design automation tools to train students and researchers.
International partnerships are supporting these efforts. India has established semiconductor cooperation frameworks with the US, Japan, Singapore, the European Union and the Netherlands, while international semiconductor companies are increasing their engagement with the Indian market.
India’s semiconductor market is projected to reach around $100–110 billion by 2030, supported by growing demand across electronics, automobiles, telecommunications, AI infrastructure and other digital industries.
The Road Ahead
Building a competitive semiconductor industry will take time. Fabrication plants require billions of dollars in investment, specialised infrastructure and highly skilled workers. Established semiconductor manufacturing hubs have also spent decades developing their supplier networks and technical expertise.
The domestic industry is expanding, with four semiconductor plants expected to be ready in 2026 and two more in 2027. The Dholera fabrication plant is expected to be ready by 2028.
India, however, enters this phase with an established chip-design workforce, a large domestic electronics market and a growing electronics manufacturing base. Government support is also expanding beyond individual factories to include design, materials, equipment, packaging, research and skills development.
The next few years will be important in determining how these investments come together across the semiconductor value chain. Building on its existing strength in chip design while expanding domestic production could help India secure a larger role in the global semiconductor industry.
As a passionate storyteller and content writer, Kushmita Bose loves weaving narratives that inform, inspire, and entertain. Whether she's unraveling tech revolutions, dissecting industry reports, or bringing a brand’s journey to life, Kushmita thrives on transforming ideas into captivating stories. When she’s not busy crafting content, you’ll probably find her daydreaming about her next travel adventure.