India Plans $11 Billion Fund to Boost Semiconductor Manufacturing

The Government of India is planning a new 1 trillion rupee (approximately $11 billion) fund to establish the country as a global semiconductor hub. Managed by the tech ministry, the fund will provide subsidies for chip design, manufacturing equipment, and supply chain development. This initiative builds upon a 2021 $10 billion program and supports Prime Minister Narendra Modi's goal to reduce import dependency for AI, automotive, and smartphone electronics.

India is currently transitioning to the India Semiconductor Mission (ISM) 2.0, which expands the scope of the original program to include specialty gases, chemicals, and materials. Domestic production capacity is projected to reach 75 to 80 million chips per day by late 2026 or early 2027. This growth focuses primarily on assembly and testing (OSAT and ATMP) rather than wafer fabrication, as India seeks to manage risk while scaling its manufacturing ecosystem.

Key projects include Micron Technology's assembly plant in Sanand, a Tata Electronics facility in Jagiroad, and joint ventures involving Foxconn and HCL in Uttar Pradesh. Additional capacity is expected from CG Power and Industrial Solutions, as well as Kaynes Semicon. Minister Ashwini Vaishnaw has stated the government's objective is to develop chipmaking capabilities comparable to global leaders by 2032. To support this industrial expansion, companies like Emerson are providing test and measurement solutions through R&D centers in Bengaluru.