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India's Semiconductor Sector Set for a $21 Billion Boost

India reviews $21 billion in semiconductor investment proposals from global and domestic giants to boost its chip manufacturing sector, aiming to become a key player in the global market.

In a significant push to position itself as a key player in the global semiconductor market, India is currently reviewing investment proposals worth a staggering $21 billion. This move is aimed at accelerating the country's nascent chip manufacturing capabilities, attracting a mix of both heavyweight domestic conglomerates and leading international firms into its burgeoning semiconductor landscape.

A Strategic Collaboration of Giants

Leading the charge in this high-stakes venture are Tower Semiconductor Ltd., an Israeli powerhouse, with a bold $9 billion proposal for a state-of-the-art plant, and the Indian titan Tata Group, which plans to invest $8 billion in a cutting-edge chip fabrication unit. These proposals, poised to take root in Gujarat, signal a transformative phase for India's semiconductor ambitions.

Tower Semiconductor's ambitious blueprint outlines a decade-long scale-up to achieve a production capacity of 80,000 silicon wafers per month. This facility, if given the green light, will mark a historic milestone as the first major semiconductor fabrication unit in India.

Tata Group's venture, in collaboration with Taiwan’s Powerchip Semiconductor Manufacturing Corp, and possibly United Microelectronics Corporation, underscores a strategic pivot towards semiconductor self-reliance. The conglomerate has earmarked Dholera for its fabrication plant, with a focus on mature chip technologies vital for a wide array of industries, from consumer electronics to defense.

Expanding the Ecosystem

Complementing these fabrication initiatives, Tata Group has also proposed a $3 billion chip-packaging plant in Eastern India. This facility is envisioned to bolster the semiconductor supply chain, catering to a global clientele including Tata Motors Ltd., a marque under the group's vast corporate umbrella.

The Indian government's endorsement of the Semicon India programme, with an allocated budget of INR 76,000 crore, underscores its commitment to nurturing a holistic semiconductor and display manufacturing ecosystem. This programme is a cornerstone of India's strategic endeavor to become a pivotal node in the global semiconductor supply network.

A Future Powered by Semiconductors

With proposals already on the table for semiconductor plants and chip assembly units, including a significant investment by Micron for a chip assembly plant, India's semiconductor industry is on the brink of a monumental leap. Projected to reach a market value of $55 billion by 2026, the sector is set to play a crucial role across various domains of the Indian economy.

The drive towards enhancing India's semiconductor manufacturing capabilities is not just about technological advancement but also about securing strategic autonomy in a critical sector. As India embarks on this ambitious journey, the global semiconductor landscape watches closely, anticipating the emergence of a new, influential player.