The Semiconductor Bet
There are two numbers that capture the contradiction at the heart of India’s semiconductor ambition.
The first is ₹2,03,500 crore. That is the combined headline outlay of the original ₹76,000-crore Semicon India Programme and the ₹1,27,500-crore Semicon 2.0 approved in July 2026. The first programme was designed to establish India’s semiconductor and display manufacturing base; the second is explicitly broader, covering design, semiconductor equipment and materials, fabrication, advanced packaging, research and development, and talent.
The second number is 90–95%. That is NITI Aayog’s estimate of the share of India’s current semiconductor consumption that is still met through imports. The country’s domestic semiconductor industry remains too young to meet the needs of its rapidly expanding electronics, automotive, telecom, energy, healthcare and defence sectors.
THE NUMBER INDIA STILL HAS TO CONFRONT
India's Semiconductor Bet
Together, those numbers explain why India is making such a large bet. The country is spending more than ₹2 lakh crore through its two major semiconductor programmes because it is trying to change a structural imbalance that has existed for decades: India has developed substantial capabilities in semiconductor design and electronics manufacturing, but most of the chips and critical inputs required by those industries still come from outside the country.
The bet, therefore, is not simply about manufacturing silicon. It is about where the value of the semiconductor age will be captured. And that makes India’s semiconductor programme one of the country’s most consequential industrial experiments of the next decade.
Together, those numbers explain why India is making such a large bet. The country is spending more than ₹2 lakh crore through its two major semiconductor programmes because it is trying to change a structural imbalance that has existed for decades: India has developed substantial capabilities in semiconductor design and electronics manufacturing, but most of the chips and critical inputs required by those industries still come from outside the country.
The bet, therefore, is not simply about manufacturing silicon. It is about where the value of the semiconductor age will be captured. And that makes India’s semiconductor programme one of the country’s most consequential industrial experiments of the next decade.
India’s semiconductor policy has moved through three distinct stages. The first was about creating an incentive framework. The ₹76,000-crore Semicon India Programme, approved in December 2021, established fiscal support for semiconductor fabrication, display manufacturing, packaging and chip design. The framework was designed to compensate for the enormous capital intensity and long gestation periods associated with semiconductor manufacturing and to attract global technology partners into India. The second stage was about getting actual projects approved.
By April 2026, ten manufacturing projects representing approximately ₹1.60 lakh crore had been approved. In May, two additional Gujarat projects—Crystal Matrix’s integrated GaN/Mini-Micro LED facility and Suchi Semicon’s OSAT facility—took the total to twelve, with cumulative investment commitments of around ₹1.64 lakh crore. The third stage is now ecosystem deepening. Semicon 2.0, approved in July 2026 with a ₹1,27,500-crore outlay, explicitly recognises that factories alone do not constitute a semiconductor industry. Its six pillars cover design, manufacturing, equipment and materials, advanced packaging, R&D and talent.
That evolution is important.
12 PROJECTS, SIX STATES, ONE EXPERIMENT
India’s policy has effectively moved from:
“Can we attract semiconductor projects?”
to:
“Can we build an ecosystem around those projects?”
The second question is substantially harder.
The project data come from MeitY/PIB’s project disclosures; some capacities are proposed installed capacities rather than current production.
There are several things worth noticing in this table.
First, Tata’s Dholera fab dominates the capital structure. At ₹91,526 crore, it represents more than half of the investment value of the twelve-project portfolio by itself. Second, the project mix is heavily weighted toward packaging and specialised semiconductor technologies rather than leading-edge logic fabrication. Third, the geography is beginning to create multiple semiconductor clusters rather than concentrating every activity in one state.
That tells us something about India’s strategy. India is not trying to reproduce the entire global semiconductor industry at once. It is building an entry portfolio.
THE NEW SEMICONDUCTOR MAP OF INDIA
The ₹1.64 lakh crore headline can make India’s semiconductor programme appear more fab-heavy than it actually is.
The Tata Dholera fab accounts for ₹91,526 crore.
Micron contributes another ₹22,516 crore.
Tata’s Assam packaging facility adds ₹27,120 crore.
CG Power’s project adds ₹7,584 crore.
Kaynes contributes ₹3,307 crore.
HCL-Foxconn contributes ₹3,706 crore.
The remaining projects are smaller individually but strategically significant because they target compound semiconductors, advanced packaging, power devices, display technologies and specialised assembly.
The implication is that India’s first semiconductor ecosystem is being built around three broad layers.
Primarily the Tata–PSMC silicon fab and the emerging SiC/compound-semiconductor projects.
Micron, CG Power, Kaynes, Tata Assam, SiCSem, Suchi and other projects.
GaN, Micro LED, display-driver ICs, power devices, glass interposers, 3D heterogeneous integration and system-in-package technologies.
This is significant because the global semiconductor industry itself is becoming less neatly divided into “fabs” and “packaging”. Advanced packaging, chiplets and heterogeneous integration are increasingly important to system performance. NITI Aayog’s 2026 roadmap explicitly argues that India should target leadership in the “More-than-Moore” era, where packaging, integration and specialised materials can create opportunities beyond the traditional leading-edge wafer race. That could become India’s strategic opening.
WHERE THE ₹1.64 LAKH CRORE+ IS GOING
No project better illustrates India’s ambition—or its risk—than Tata’s Dholera fab.
The project represents ₹91,526 crore of investment and approximately 50,000 wafer starts per month. It is being developed in technology partnership with Taiwan’s Powerchip Semiconductor Manufacturing Corporation. The Government of India has signed a fiscal-support agreement for the project, and the facility has been notified as a dedicated semiconductor SEZ covering 66.166 hectares with projected employment of approximately 21,000 people.
The technology strategy is deliberately different from the race for the world’s smallest transistor. The fab is expected to operate in the mature node range, broadly around 28nm to 110nm, targeting applications such as automotive, industrial, communications and other sectors where mature technologies remain commercially important. That is not technological surrender. It is an attempt to choose a market in which India can build manufacturing competence before taking on more difficult technology frontiers.
The economic logic is straightforward. India does not need every chip used in a smartphone, automobile or industrial machine to be fabricated at 2nm.
It needs reliable access to the enormous range of chips that sit behind power management, automotive electronics, industrial controllers, communications, sensors, mixed-signal systems and other applications. The Dholera fab is, therefore, best understood as
India’s manufacturing school as much as its first large commercial fab.
Its success will depend on whether India can acquire process expertise, achieve competitive yields, attract customers and create a supplier ecosystem around it. The foundation stone is not the milestone that matters. Yield is.
FROM IMPORT DEPENDENCE TO VALUE CAPTURE |
A semiconductor fab looks like a factory from the outside. Inside, it behaves more like a highly integrated technological ecosystem.
It requires high-purity chemicals, specialty gases, wafers, precision equipment, cleanroom systems, ultrapure water, waste treatment, continuous power, specialised logistics, testing infrastructure and engineers with process-specific knowledge.
This is why the government’s shift toward equipment and materials in Semicon 2.0 is so important.
NITI Aayog’s semiconductor roadmap says India needs to develop stronger domestic capabilities across materials, substrates, SiC and GaN, advanced packaging substrates and semiconductor manufacturing inputs. It also recommends a value-chain-wide approach rather than focusing solely on wafer fabrication.
The opportunity here is potentially much broader than the twelve approved plants. A company that supplies a fab does not need to own a fab.
An Indian engineering company capable of producing a high-precision component, a gas-delivery system, packaging substrate, testing system or water-treatment technology could become part of the semiconductor economy without investing ₹90,000 crore. That is the multiplier effect policymakers should ultimately be trying to create.
India's Mobile-Phone Exports Have Surged
India's Electronics Production Has Exploded
This is where the Indian semiconductor story becomes uncomfortable. NITI Aayog estimates that 90–95% of current semiconductor consumption in India is met through imports. Its analysis also notes that India spent approximately $150 billion cumulatively importing semiconductor products between FY2017 and FY2025. Imports of semiconductor products grew at a CAGR of approximately 23% over that period. If that pace were to continue, the report estimates that annual import costs could reach around $240 billion by 2035.
These numbers require an important qualification: the NITI Aayog report uses a defined set of semiconductor-product classifications and projections, so they should not be interpreted as India’s entire electronics import bill. But the direction is unmistakable. India’s electronics industry is expanding faster than its domestic semiconductor capability. That creates an enormous foreign-exchange and supply-chain exposure.
The problem is not simply that India imports chips. The deeper problem is that India also imports many of the inputs required to manufacture chips.
CSIS estimates that more than 90% of critical semiconductor inputs—including high-purity chemicals, specialty gases and silicon wafers—are imported. It also identifies shortages in semiconductor-specific manufacturing infrastructure and specialised talent as major constraints on India’s ambitions.
That means the phrase “semiconductor self-reliance” needs to be used carefully. If India manufactures a chip locally but imports the wafer, chemicals, equipment, packaging material and much of the intellectual property required to produce it, the country has reduced one form of dependence without eliminating the deeper one. The real objective has to be progressive value capture.
India’s electronics story provides the reason this localisation effort matters.
Government data show electronics production reaching approximately ₹13.11 lakh crore in FY2025–26, while electronics exports reached approximately ₹4.24 lakh crore. Mobile-phone production alone reached approximately ₹6.27 lakh crore, with mobile-phone exports at around ₹2.59 lakh crore.
Those figures demonstrate that India has already built a substantial downstream market. The semiconductor challenge is to move further upstream.
Think of the electronics value chain as a ladder:
Imported chip → Indian assembly → Indian product → export
is one level.
The more ambitious model is:
Indian design → Indian IP → wafer fabrication → Indian packaging → Indian testing → Indian component integration → Indian product → export
The second model creates much more domestic value.
It also creates a much stronger technological ecosystem because every layer generates knowledge, suppliers, skilled labour and intellectual property.
That is why semiconductor policy should not be evaluated separately from electronics-component policy. The two are parts of the same industrial transition.
India’s strongest semiconductor capability did not begin in a cleanroom.
It began in design centres.
NITI Aayog estimates that Indian professionals account for approximately 20% of the global semiconductor design workforce. Global semiconductor companies have long operated large design and engineering centres in India, creating a deep pool of expertise even while physical manufacturing remained overseas.
The government is now trying to convert that engineering base into indigenous semiconductor IP.
The Design Linked Incentive programme provides reimbursement of up to 50% of eligible expenditure, capped at ₹15 crore per application, while its deployment-linked incentive provides 4–6% of net sales turnover for five years, capped at ₹30 crore, subject to deployment requirements.
The programme has also created shared infrastructure.
The ChipIN Centre has provided access to advanced EDA tools to around one lakh engineers and students across approximately 400 organisations, according to MeitY. The EDA Grid used by 95 supported startups had accumulated more than 5.4 million hours of usage by January 2026. DLI-supported companies had completed 16 chip-design tape-outs and fabricated six semiconductor chips, while more than 1,000 specialised engineers had been trained or engaged through supported projects.
The government subsequently reported broader semiconductor talent initiatives involving 175 chip designs taped out, more than 68,000 people skilled in chip design and more than one lakh engineers trained across the wider talent-development ecosystem. The numbers are encouraging. But they also expose the next challenge.
Chip Idea to Commercial Product
The semiconductor industry has a vocabulary that can make progress sound further along than it actually is.
A chip being designed is not the same as a chip being fabricated. A tape-out is not the same as a qualified product. A fabricated chip is not the same as a commercially successful chip.
The actual pipeline is:
Architecture → Design → Verification → Tape-out → Fabrication → Packaging → Testing → Qualification → Customer validation → Volume production
India is beginning to populate the early and middle stages of this pipeline. The commercial question is whether companies can consistently make it to the last two. This is why recent investment activity among Indian fabless startups is worth watching. Industry reporting based on Tracxn data suggests Indian semiconductor startups raised approximately $92 million across 12 deals in the first five months of 2026, nearly four times the total funding recorded during all of 2025. Another report put early-2026 funding at $30.8 million across four rounds, reflecting different reporting windows.
The more interesting development is that companies are moving beyond design toward tape-outs and pilot production. That is the stage at which venture capital begins to encounter the harder realities of semiconductor economics. A startup must finance fabrication. It must survive testing failures. It must qualify with OEMs. It must manufacture reliably. And it must persuade customers to replace an incumbent component with a new Indian-designed chip.
The number that ultimately matters is therefore not how many Indian startups design chips. It is:
How many Indian-designed chips become repeat commercial products?
This is where India may have an opportunity to repeat part of its software-era success—but with a very different business model. A fabless semiconductor company can design its product without owning a semiconductor fabrication plant. It can use EDA tools, work with a foundry, arrange packaging and testing, and sell its chip globally. That makes the capital barrier lower than owning a leading-edge fab. India already possesses the design talent, engineering workforce and growing electronics market needed to support such companies. The government is also deliberately building infrastructure to help startups move from design to silicon. But semiconductor startups are not software startups. They require more capital, longer development cycles and far more expensive physical validation. The opportunity is therefore real, but the mortality rate will also be high. India should not measure success by the number of startups supported. It should measure it by the number of IP blocks, tape-outs, production chips, customer qualifications and export revenues generated by those companies.
The timing of India’s semiconductor push is unusually favourable because the global semiconductor cycle is being reshaped by AI.
NITI Aayog estimates that global semiconductor demand is entering a new phase driven by artificial intelligence, 5G/6G, electric vehicles, data centres, industrial automation and edge intelligence. Its roadmap projects the global semiconductor market to exceed $1.5 trillion by 2035, while India’s semiconductor demand could exceed $200 billion by 2035. It estimates India’s demand growing at approximately 19% CAGR, reaching around $90 billion by FY2030 under its modelling framework.
That creates a significant opportunity. AI is not just a demand story for processors.
AI infrastructure requires:
compute accelerators;
memory;
high-speed networking;
advanced packaging;
power-management chips;
sensors;
optical interconnects;
storage;
cooling and control electronics.
The data centre build-out, therefore, creates semiconductor demand across multiple layers. For India, this intersects with another major structural shift: electrification. Data centres require power. EVs require power electronics. Renewable-energy systems require power semiconductors. Industrial automation requires controllers and sensors.
The semiconductor opportunity is therefore increasingly connected to India’s AI, energy, mobility and manufacturing strategies at the same time.
SEMICONDUCTOR
The most intelligent part of India’s semiconductor strategy may be the areas where it chooses not to compete immediately. NITI Aayog’s roadmap explicitly argues that India should avoid simply entering a catch-up race in leading-edge wafer fabrication. Instead, it recommends focusing on mature-node logic, specialty analog and mixed-signal chips, compound semiconductors, advanced packaging and wide-bandgap materials such as silicon carbide and gallium nitride.
That makes sense in the Indian context. A 2nm processor is technologically impressive, but India does not need to manufacture every 2nm processor used globally. India does need reliable access to power electronics for EVs, renewable energy, chargers, industrial systems and automotive applications.
SiC and GaN can therefore provide a more attainable route into strategically important semiconductor markets. India’s approved SiCSem project in Odisha combines a SiC fab with packaging capability, while CDIL in Punjab is expanding into high-power devices, including MOSFETs, IGBTs, Schottky bypass diodes and transistors in silicon and silicon carbide. Crystal Matrix’s Dholera project adds GaN epitaxy and Mini/Micro LED capability. These are not side projects. They are examples of the differentiated strategy that NITI Aayog is recommending.
India may have an even stronger opportunity in advanced packaging. Traditional semiconductor economics placed enormous emphasis on wafer fabrication. But modern chip architectures increasingly rely on sophisticated packaging to connect multiple dies, improve bandwidth, manage thermal performance and integrate different technologies.
Chiplets, 2.5D and 3D integration, system-in-package and heterogeneous integration are changing the value proposition. India already has nine packaging projects in the approved portfolio. The 3D Glass Solutions project in Odisha is particularly notable because it targets glass interposers, silicon bridges, RF system-in-package, antenna-in-package and 3D heterogeneous integration.
NITI Aayog’s 2035 roadmap goes further, proposing that India should become a top-three global destination for OSAT and advanced packaging. It also recommends building capabilities in areas including CoWoS, HBM-logic integration, fan-out wafer-level packaging and chiplet-based systems.
This could be one of India’s most realistic routes to global relevance. The country already has electronics manufacturing scale. It has a deep engineering workforce. It has a growing packaging project pipeline. And it does not need to outspend Taiwan on leading-edge lithography to become important in advanced packaging. If executed well, packaging could become the bridge between India’s current strengths and the next generation of semiconductor architectures.
THE GLOBAL BENCHMARK
The semiconductor map is also becoming a map of industrial policy.
Gujarat has emerged as the clear centre of gravity, combining Dholera and Sanand with fabrication, memory packaging, OSAT, power electronics and compound semiconductor projects.
Jewar creates a different model: semiconductor manufacturing connected directly to the large NCR electronics and mobile-manufacturing ecosystem.
Tata’s ₹27,120-crore packaging project gives the Northeast a role in one of India’s most technology-intensive industries. Its planned 48 million units per day capacity makes it one of the largest projects in the current pipeline.
Odisha is developing a cluster around SiC and advanced packaging, potentially linking semiconductor manufacturing with the country’s future EV and renewable-energy demand.
CDIL’s power-semiconductor expansion builds on an existing domestic semiconductor manufacturing base rather than starting entirely from zero.
ASIP brings South Korean technology partnership into the Indian semiconductor landscape.
The objective should not simply be to have semiconductor factories in six states. It should be to create specialised clusters where suppliers, universities, skilled labour and downstream customers reinforce one another.
A semiconductor fab is one of the most demanding industrial facilities a country can build. It needs stable power, high-quality water, cleanrooms, environmental controls, specialised logistics and highly controlled chemical supply.
Dholera illustrates the scale of the infrastructure challenge. Public planning documents for the wider Dholera industrial region include dedicated raw-water infrastructure, storage, planned desalination, common effluent treatment and cleanroom facilities.
This is important because semiconductor manufacturing can turn a weakness in basic infrastructure into a direct production risk. A brief power interruption can damage a wafer-processing cycle. Water cannot simply be “available”; process water must be purified to extremely high standards.
Chemical waste cannot simply be treated like ordinary industrial effluent. Logistics cannot be designed around normal manufacturing assumptions when equipment can be extraordinarily sensitive and expensive. In other words: A semiconductor ecosystem requires infrastructure that is itself high technology. That creates another opportunity for Indian companies in water treatment, power management, cleanrooms, precision logistics and industrial engineering.
INDIA DOESN’T NEED TO WIN EVERY SEMICONDUCTOR RACE
India’s semiconductor advantage is often summarised with one number: 20% of global semiconductor design talent. But manufacturing requires a different talent profile.
NITI Aayog’s roadmap identifies shortages in process integration, yield engineering, advanced packaging, materials engineering, reliability, package-aware design and system-level solution architecture. It recommends global talent-infusion programmes and greater involvement of experienced professionals in fabs, OSATs, design hubs and training institutions.
CSIS estimates that India produces roughly 600,000 electronics-related engineering graduates annually, but argues that only around 1% currently possess the specialised skills required for fabrication, advanced packaging and precision equipment maintenance without substantial retraining. Its analysis projects a potential shortfall of 250,000–300,000 skilled semiconductor professionals by 2027.
The exact industry shortfall is difficult to forecast and should be treated as an estimate rather than a government fact. But the underlying problem is real. India can produce engineers much faster than it can produce engineers with ten years of semiconductor manufacturing experience.
That is why international partnerships matter. The technology partnership is not merely about importing equipment. It is also about importing know-how, creating Indian teams around experienced global professionals and transferring process knowledge over time.
Malaysia is particularly relevant because it demonstrates that a country does not have to dominate leading-edge wafer fabrication to become an important semiconductor economy. CSIS estimates Malaysia accounts for around 4% of global assembly, testing and packaging market share.
India’s potential advantage is that it combines an emerging OSAT base with something Malaysia does not possess at the same scale: a huge domestic electronics market and a semiconductor design workforce estimated at around one-fifth of the global total.
The challenge is turning those two strengths into one ecosystem.
SEMICONDUCTOR 2021-2030
The greatest danger in India’s semiconductor strategy is not that the country builds too little. It is that it builds capacity faster than it builds competitiveness. A semiconductor fab can be technically operational and still struggle commercially.
The critical metrics are:
yield
utilisation
cost per wafer
customer qualification
technology relevance
export demand
supplier localisation
A government subsidy can help a project reach the first production run. It cannot indefinitely compensate for poor yields or low utilisation. This is why the first commercial-production announcements in 2026 are important but should not be treated as the end of the story. They prove that India can cross the construction and commissioning barrier. They do not yet prove that India can manufacture semiconductors at globally competitive economics. That proof will take several years.
There is another way the semiconductor programme could succeed partially and still fall short of its larger ambition. India could become an attractive location for multinational manufacturing while failing to create enough Indian semiconductor product companies.
That outcome would still generate jobs, exports, technology transfer and manufacturing capability. But the value captured by India would be lower than in a system where Indian companies also own the IP, technology platforms and global customer relationships. This is why the DLI programme is so important. The government is not only trying to attract fabs. It is trying to create companies that own chips, SoCs, systems and IP cores. The ultimate measure of this effort should therefore be: How many Indian semiconductor companies become globally relevant?
Not: How many Indian semiconductor projects receive government approval?
INDIA's SEMICONDUCTOR ROADMAP
There is a subtle danger in celebrating every localised manufacturing milestone. Suppose India packages a chip domestically. That is valuable.
But if the wafer is imported, the packaging substrate is imported, the critical chemicals are imported, the equipment is imported and the IP is foreign-owned, the domestic value addition may still be limited. The next stage of policy must therefore track where the inputs originate. NITI Aayog’s roadmap proposes exactly this broader metric.
It recommends that India target 15–25% chip self-sufficiency by 2030 and 35–50% by 2035, but it goes further by targeting 35–40% value-chain self-sufficiency by 2030 and 55–70% by 2035.
That distinction is extremely important. It recognises that a semiconductor can be “made in India” without enough of its economic value actually being captured in India.
NITI Aayog’s 2026 roadmap sets out a considerably more ambitious vision than simply achieving semiconductor self-sufficiency.
It proposes that India target:
$120–150 billion semiconductor value
chain by 2035
10–13% of the global semiconductor market
15–25% chip self-sufficiency by 2030
35–50% chip self-sufficiency by 2035
35–40% domestic value retention by 2030
55–70% value retention by 2035
top-three global position in advanced OSAT
and packaging
leadership in SiC and GaN/wide-bandgap materials
more than 100 advanced semiconductor
IPs by 2035
exports of locally relevant chips to 50+ countries.
These are not current achievements. They are strategic targets. That distinction must be maintained in the magazine. But the targets are useful because they give us something against which India’s semiconductor progress can eventually be judged.
There is another number buried in NITI Aayog’s roadmap that changes our understanding of the scale of the challenge.
The report estimates that building a globally competitive Indian semiconductor ecosystem could require approximately $135–180 billion of cumulative semiconductor investment over the next decade, spanning design, fabrication, advanced packaging, materials and supporting infrastructure. It recommends that the government commit at least one-third of the required investment to de-risk projects and crowd in private capital.
That puts today’s ₹2.03 lakh crore combined Semicon 1.0 and 2.0 headline outlay into perspective. It is large. But it is not the entire capital requirement. India is effectively at the beginning of a decade-long industrial investment cycle. The government’s role is therefore unlikely to end with Semicon 2.0.
It will have to create conditions under which private capital, global semiconductor companies and Indian industrial groups continue investing long after the initial incentives have been announced.
This is perhaps the most underappreciated dimension of the semiconductor story.
Consider a ₹91,526-crore fab. The fab itself is one project. But around it can emerge:
chemical suppliers;
gas suppliers;
wafer and substrate companies;
precision-engineering firms;
equipment maintenance companies;
cleanroom specialists;
water-treatment providers;
testing companies;
packaging-material suppliers;
logistics providers;
industrial automation firms;
specialised software companies;
semiconductor design firms.
If even a fraction of those capabilities become domestically competitive, the economic multiplier could be much larger than the direct investment in fabs. This is why Semicon 2.0’s equipment-and-materials focus could ultimately have a larger impact on Indian manufacturing than another round of large factory announcements.
The semiconductor industry could become a customer for India’s precision-engineering sector. That would be a much deeper industrial transformation.
WHAT SUCCESS SHOULD LOOK LIKE IN 2030
There is one more piece missing from the story: demand assurance. A semiconductor manufacturer needs customers willing to qualify and buy its chips. India has the downstream industries. It has automobile manufacturers. It has telecom companies. It has appliance manufacturers. It has industrial-electronics companies. It has defence and aerospace programmes. It has a growing data centre economy.
But these companies already have established international suppliers. Convincing them to switch to a new domestic semiconductor source will require more than patriotic procurement.
The chips have to meet demanding standards of: quality, reliability, price, consistency and supply continuity.
NITI Aayog’s roadmap recognises this by recommending demand-assurance and long-term procurement mechanisms to stabilise semiconductor-facility utilisation and by emphasising export-market integration.
This is where the semiconductor mission intersects directly with industrial procurement policy.
The government may need to become not only a funder of semiconductor capacity but also an early market creator for strategically important Indian-designed and manufactured chips.
The self-sufficiency and value-retention targets are from NITI Aayog’s 2035 roadmap and should be presented as targets, not current achievements.
This scorecard is more meaningful than asking whether India has “become a semiconductor hub.” A hub is a label. Yield, exports, IP, localisation and customer adoption are evidence.
The answer depends on what “win” means. If winning means becoming the next Taiwan in advanced logic manufacturing, India has no realistic reason to define its strategy that way.
Taiwan has decades of accumulated process expertise, supplier networks, customer relationships and manufacturing culture. Trying to reproduce that model wholesale would require enormous capital and years of catch-up.
But if winning means becoming a strategically indispensable semiconductor node, the proposition becomes considerably more credible.
India could combine:
20% of global semiconductor design talent
with
a huge domestic electronics market
with
mature-node fabrication
with
advanced packaging
with
SiC/GaN
with
electronics manufacturing
with
a large engineering workforce
with
geopolitical demand for supply-chain diversification.
That is a differentiated model.
And it is exactly where NITI Aayog’s roadmap is pointing.
Its central argument is effectively that India should stop trying to win someone else’s semiconductor race and instead identify the segments where it can become indispensable.
INDIA's SEMICONDUCTOR BET
The first Indian semiconductor era was largely a story of designing for the world from India. The next one could be about designing, making, packaging and exporting from India. That is a much bigger proposition.
It would mean that when an Indian automobile company develops an electric vehicle, some of the power electronics could come from Indian semiconductor facilities. When an Indian telecom company expands its network, some of its chips could be designed by Indian fabless companies.
When India builds AI infrastructure, some of the networking, power-management or specialised compute components could originate from Indian semiconductor IP. When India builds satellites and defence systems, strategically important chips could increasingly be designed and manufactured under trusted domestic control.
When an electronics company exports a product, more of the value embedded inside that product could remain in India. That is the real industrial promise. But the distance between promise and outcome remains substantial.
India has 12 approved manufacturing projects and more than ₹1.64 lakh crore of committed investment. Three facilities have already entered commercial production. The country has built a growing design ecosystem, has access to global technology partnerships and has committed another ₹1,27,500 crore to the next phase.
At the same time, NITI Aayog estimates that 90–95% of semiconductor consumption is still imported, and it projects that India will need to invest $135–180 billion over the coming decade if it wants to build a globally competitive ecosystem.
That is why India’s semiconductor story should not yet be described as a victory. It is an industrial wager in progress.
The first bet was that India could attract the factories. That bet is beginning to pay off.
The second is that India can operate them competitively. That remains to be proven.
The third is that the factories can generate an ecosystem of Indian suppliers, designers, researchers and product companies. That is where the real economic value lies.
And the fourth is the most ambitious of all:
Can India become indispensable to the global semiconductor supply chain without having to dominate every part of it?
If the answer is yes, the payoff will extend far beyond the semiconductor industry.
It will strengthen India’s automotive sector, electronics exports, AI infrastructure, telecom networks, defence capabilities, energy transition and advanced manufacturing base. It could also create a new generation of Indian industrial companies operating at the intersection of materials science, precision engineering, electronics and intellectual property.
The number to watch, therefore, is not simply ₹2,03,500 crore. It is not even ₹1.64 lakh crore.
The number that ultimately matters is the percentage of semiconductor value that India can design, manufacture, package, supply and own. Today, that share is still too small.
By 2030, NITI Aayog wants India to retain 35–40% of semiconductor value domestically. By 2035, it wants that figure to reach 55–70%, while building a $120–150 billion semiconductor value chain and a top-three global advanced-packaging position.
Those targets are extraordinarily ambitious. But they also give India something it has not had before: a measurable definition of semiconductor sovereignty.
The semiconductor bet will be won not when India produces its first chip. It will be won when an increasing share of the design, IP, materials, manufacturing, packaging, engineering, supply chain and profit behind that chip belongs to the Indian economy.
That is the race India has actually entered. And it is only beginning.