The Indian government has approved four major semiconductor manufacturing projects under the Semicon India Programme. This initiative aims to reduce dependency on imports, boost domestic production, and position India as a key global hub for semiconductor manufacturing.
The first project, led by Tata Electronics Private Limited (TEPL), involves setting up a Semiconductor Fab facility with an investment of ₹91,526 crore. This facility, established in partnership with Taiwan’s PSMC, will have a production capacity of 50,000 wafer starts per month (WSPM). The collaboration with PSMC, which operates six foundries in Taiwan, brings advanced manufacturing expertise to India.
In addition to the fab facility, TEPL also secured approval for an Outsourced Semiconductor Assembly and Test (OSAT) unit, valued at ₹27,120 crore. This facility will use indigenous semiconductor packaging technologies and will produce 48 million units per day. The OSAT facility represents a step forward in creating an end-to-end semiconductor ecosystem in India.
The third approved project comes from CG Power and Industrial Solutions Limited, with an investment of ₹7,584 crore. This facility will operate as a joint venture with Renesas Electronics America Inc. and STARS Microelectronic, Thailand. Technology support will come from Renesas Electronics Corporation, Japan, and STARS Microelectronic, Thailand. Once operational, the facility will produce 15.07 million units daily.
Lastly, Kaynes Technology India Limited (KTIL) received approval for an OSAT facility in Sanand, Gujarat, valued at ₹3,307 crore. The technology for this facility will come from ISO Technology Sdn. Bhd. and Aptos Technology Inc. The facility will have the capacity to produce 6.33 million chips per day and will further strengthen Gujarat’s position as a technology and manufacturing hub.
India’s Semiconductor Push: A Global Perspective
The semiconductor industry has seen significant growth worldwide, driven by the increasing adoption of AI, IoT, and advanced memory chips. India is emerging as a strategic player in this sector by leveraging both foreign partnerships and domestic expertise.
Global investments, such as Micron Technology’s ATMP facility in Gujarat and Tata’s foundry in Dholera, highlight India’s rising importance in the global semiconductor supply chain. Additionally, Lam Research is set to train 60,000 engineers through its Semiverse Solutions platform and invest $25 million in a lab in Karnataka to foster innovation.
Key Drivers of Growth in India’s Semiconductor Sector
- Government Support: Strategic initiatives under the Semicon India Programme provide financial incentives and policy support to semiconductor manufacturers.
- Global Partnerships: Collaborations with technology leaders like PSMC, Renesas, and Aptos bring advanced technology and expertise to India.
- Skilled Workforce: Programs like Lam Research’s training initiatives aim to address the skill gap in semiconductor manufacturing.
- Regional Development: Investments in Gujarat and Karnataka are boosting local economies while strengthening India’s manufacturing infrastructure.
Future Outlook and Challenges
While the sector shows immense promise, challenges remain. Semiconductor manufacturing is capital-intensive, and maintaining consistent quality and output will require sustained investment in infrastructure and talent development. Additionally, managing supply chain dependencies and ensuring technological upgradation will be critical for long-term success.
Despite these hurdles, the approved projects under the Semicon India Programme set a strong foundation for growth. As the semiconductor market continues to expand globally, India is well-positioned to become a significant contributor to the global supply chain.
With a focus on innovation, strategic partnerships, and talent development, India’s semiconductor industry is set to play a transformative role in the country’s economic and technological future.
