New Delhi: India has received investment pledges worth as much as $12 billion from global and domestic investors within months of launching its new semiconductor policy, signalling growing interest in building a domestic chip manufacturing ecosystem. Technology Minister Ashwini Vaishnaw announced the commitments at India’s major semiconductor industry event in New Delhi on Thursday.
The pledges cover companies involved in semiconductor equipment, materials and chemicals, adding to India’s efforts to develop capabilities across the chip supply chain. The commitments are expected to be made over the next two to three years, although the government has not disclosed the names of all the companies behind the proposed investments.
The latest investment interest comes after India announced a fresh $13.4 billion semiconductor fund in July, expanding its support for an industry that the government sees as strategically important for the country’s technology and manufacturing ambitions.
New semiconductor fund drives investment interest
India’s latest semiconductor initiative builds on an earlier $10 billion subsidy programme, which helped companies including Tata Group and Micron Technology establish fabrication and assembly facilities in the country.
The new funding programme is intended to strengthen India’s domestic chip ecosystem and attract more companies involved in different stages of semiconductor production.
Vaishnaw said the newly announced investment commitments would be spread over the next two to three years. While the government has not identified all the investors, the commitments include companies involved in chip equipment, materials and chemicals.
The government’s strategy is not limited to semiconductor fabrication. Developing supporting industries is also considered important because chip manufacturing requires a wide network of specialised equipment suppliers, chemical producers, material manufacturers, testing companies and other technology providers.
Applied Materials announces $5 billion investment
Among the companies making fresh commitments is semiconductor equipment manufacturer Applied Materials.
The company announced at the event that it plans to invest $5 billion in India over the next decade. The investment is expected to strengthen its presence in India’s growing semiconductor manufacturing ecosystem.
Another major equipment manufacturer, Lam Research, said it plans to invest around $1 billion in a local manufacturing facility.
The announcements from the two global semiconductor equipment companies add to India’s efforts to build a more comprehensive supply chain rather than depending heavily on imported equipment and materials.
The expansion of such capabilities could also support semiconductor fabrication projects being established by Indian and international companies.
Micron prepares for large-scale chip testing and assembly
Micron Technology is also expanding its semiconductor operations in India.
Micron CEO Sanjay Mehrotra said the company will test and assemble hundreds of millions of chips in India in 2027, following the start of production at its local plant this year.
Micron is among the companies that received approval under India’s earlier semiconductor policy.
The company is establishing a semiconductor assembly, test, marking and packaging facility in Gujarat. Its progress is being closely watched as one of the early examples of large-scale international semiconductor investment in India.
Vaishnaw said some companies approved under the previous policy are already in commercial production. He added that the production currently available and capacity being created are already booked, indicating demand for the output from these facilities.
Tata Electronics signs five semiconductor agreements
Tata Group’s electronics and semiconductor business also announced several developments during the industry event.
Tata Electronics signed five agreements covering different parts of the semiconductor supply chain. One of the agreements is with Nexperia BV and covers semiconductor wafer manufacturing, assembly and testing.
The partnership will support Tata’s fabrication plant in Gujarat as well as its assembly facility in Assam.
Tata Electronics also announced a collaboration with Fujifilm Corporation for the local production of critical raw materials.
The partnership is intended to help develop a supply chain around Tata’s semiconductor facility at Dholera in Gujarat.
These agreements indicate the increasing focus on developing domestic suppliers alongside semiconductor fabrication and assembly facilities.
India seeks deeper semiconductor ecosystem
The latest commitments come as India attempts to move beyond simply attracting individual chip plants and build a broader semiconductor ecosystem.
The industry requires specialised suppliers at multiple stages, from raw materials and chemicals to equipment, wafer manufacturing, packaging, testing and assembly.
Tata Electronics CEO Randhir Thakur said the question for India had shifted from whether chips could be manufactured domestically to how quickly and extensively the semiconductor ecosystem could be developed.
The comments reflect the rapid expansion of semiconductor-related projects announced in India over the past few years.
The government has also highlighted India’s large pool of engineering graduates and semiconductor-focused policies while seeking to attract international companies.
Modi pitches India as semiconductor destination
Prime Minister Narendra Modi also addressed the semiconductor industry event on Thursday, where he sought to attract global investors to India’s chip sector.
The government’s pitch centres on India’s engineering talent, growing electronics industry and policy support for semiconductor manufacturing.
The semiconductor push is also linked to the rapid growth of artificial intelligence, data centres, electric vehicles, smartphones and other technologies that require increasingly sophisticated chips.
Building domestic manufacturing and supply-chain capabilities is expected to reduce India’s dependence on overseas sources while creating opportunities for technology and electronics companies.
India moves from policy to production
The latest $12 billion in investment pledges comes at a time when India’s semiconductor strategy is moving from policy announcements towards actual production.
Companies such as Micron and the Murugappa Group’s chip business are already in commercial production under projects approved through the earlier policy. At the same time, new commitments from equipment manufacturers and materials suppliers could expand the ecosystem around upcoming fabrication and assembly facilities.
India’s new $13.4 billion semiconductor fund is expected to provide further support for this expansion.
The challenge now will be converting investment pledges into operational facilities, building a reliable supplier network and developing the skilled workforce required for advanced semiconductor manufacturing.
With billions of dollars in new commitments and major companies expanding their Indian operations, the country’s semiconductor strategy is entering a phase focused increasingly on capacity creation and supply-chain development.