Vinay Karanam By Vinay Karanam, Hindu, Multicultural, Community, Technology, Science and Defence Specialist
India is making determined strides toward semiconductor self-reliance, positioning itself as a key player in the global microelectronics supply chain. With a series of strategic investments, policy reforms, and international partnerships, the nation is laying the foundation for a robust domestic semiconductor ecosystem—a move with far-reaching implications for technology, defence, and economic sovereignty.
At the heart of this transformation is the India Semiconductor Mission (ISM), launched in 2021 with an outlay of ₹76,000 crore (approximately NZ$13 billion). The mission aims to create a complete semiconductor value chain, from design and fabrication to packaging and testing. In early 2025, the government approved its first three semiconductor fabrication units—two in Gujarat and one in Karnataka—marking a historic milestone in India’s technological evolution.
One of the most significant developments is the Tata Group’s semiconductor plant in Dholera, Gujarat. Set to begin production in late 2026, the facility will manufacture 300mm wafers using 65-nanometre and 40-nanometre process nodes, catering primarily to automotive, industrial, and consumer electronics sectors. The plant, built in collaboration with Taiwan-based Powerchip Semiconductor Manufacturing Corporation (PSMC), is expected to create over 15,000 direct and indirect jobs.
Equally noteworthy is the establishment of a semiconductor assembly, testing, marking, and packaging (ATMP) facility in Mysuru by CG Power, in partnership with Israel’s Tower Semiconductor. This facility will support backend operations, a critical component often overlooked in chip manufacturing discussions. Additionally, multiple design hubs are emerging in Bengaluru, Hyderabad, and Pune, where Indian engineers are developing indigenous system-on-chip (SoC) solutions for defence, space, and telecommunications.
The geopolitical context amplifies the urgency. With global supply chains disrupted by pandemics, trade tensions, and regional conflicts, nations are re-evaluating their dependence on a handful of semiconductor-producing countries. India’s push aligns with the Quad alliance’s broader strategy to diversify chip manufacturing across democratic nations. The US and Japan have already extended technical support, while France and South Korea are exploring joint ventures in materials and equipment supply.
For New Zealand and other Pacific nations, India’s semiconductor growth presents opportunities for collaboration in secure communications, defence electronics, and research and development. Indian-designed chips are already being used in satellite systems and secure networking devices deployed across South Asia and the Indian Ocean region.
Challenges remain. India still lacks the capability to produce cutting-edge sub-10nm chips used in high-performance computing and AI. The shortage of skilled workforce, high capital costs, and limited access to advanced photolithography tools—particularly extreme ultraviolet (EUV) machines controlled by the Netherlands’ ASML—pose significant hurdles.
Nonetheless, the momentum is undeniable. Educational institutions are expanding microelectronics programmes, and the government is incentivising startups through the SPECS (Semiconductor Production Linked Incentive) scheme. Additionally, the integration of traditional knowledge systems with modern engineering—such as applying Vedic principles in algorithmic design—is gaining attention in academic circles.
India’s semiconductor journey is not merely about economic gain; it is a strategic imperative for national security and technological autonomy. As the world enters an era defined by AI, quantum computing, and next-generation networks, the ability to design and manufacture chips domestically will determine a nation’s digital sovereignty.
Excerpt: India’s semiconductor ambitions reflect a comprehensive national strategy to secure its technological future, reduce import dependency, and emerge as a trusted node in the global electronics supply chain.
