India has unveiled its plan to invest $13 billion as part of the second phase of its semiconductor mission, aiming to establish a comprehensive domestic chip ecosystem that includes design, manufacturing, assembly, and testing.
This initiative seeks to address the country’s significant reliance on imported semiconductors amid a rapidly growing domestic chip demand projected to reach $200 billion by 2035.
The government has approved 12 semiconductor projects in six states, with companies like Micron, Kaynes Semicon, and CG Semi starting commercial production focused on assembly, testing, and packaging this year, while advanced wafer fabrication remains limited.
A notable partnership between Tata Electronics and Taiwan’s Powerchip in Dholera, Gujarat, expects to produce its first chips by December, complemented by Tata’s $11 billion MoU with ASML to support advanced chip manufacturing for sectors such as automobiles and artificial intelligence.
greatest strength lies in its semiconductor research and design capabilities, supported by a large pool of chip-design engineers, but the country currently lacks sufficient fab-floor operators and process engineers essential for wafer production.
Developing this talent is central to the government’s strategy. Union Minister Ashwini Vaishnaw announced plans to cultivate 100,000 semiconductor engineers, noting that 85,000 have already been trained within four years, surpassing the initial 10-year goal.
To bolster skills, semiconductor design courses are now offered at 355 universities, including those in smaller towns, positioning India to capitalize on a global industry workforce shortfall estimated at one million by 2032.
A NITI Aayog report highlights that India imports 90–95% of its semiconductors, emphasizing the strategic necessity to reduce dependence through domestic production capacity expansion.
To encourage investment, central subsidies cover up to 50% of project costs, with additional incentives from state governments aiding the sector’s growth.
The broader vision moves beyond ‘Make in India’ to ‘Engineer in India,’ building on the engineering talent base to create a full semiconductor ecosystem. Success will depend on aligning this skilled workforce with manufacturing expertise, infrastructure, technology, and industrial networks to produce competitive chips.