India is accelerating its "Designed in India, Made in India" semiconductor vision through significant investments and strategic partnerships, aiming to establish a robust domestic chip manufacturing ecosystem. The nation has seen a surge in approved projects under the India Semiconductor Mission (ISM), with a total of 12 semiconductor-related plants now underway across the country, encompassing fabrication, assembly, testing, and packaging. These initiatives are crucial for reducing India's substantial dependency on semiconductor imports, which amounted to an estimated $19.9 billion in fiscal year 2022-23 and were projected to reach $30.3 billion by 2024-25.
Accelerated Investment and New Facilities
Recent approvals under the ISM highlight the rapid expansion of India's semiconductor capabilities. On May 5, 2026, the Union Cabinet sanctioned two new projects with a combined investment of approximately INR 39.36 billion (US$393.6 million). One of these projects involves Crystal Matrix Limited, which will establish India's first commercial mini/micro-LED display manufacturing facility based on Gallium Nitride (GaN) technology in Dholera, Gujarat. This facility will also offer GaN foundry services and is expected to produce 72,000 square meters of mini/micro-LED display panels annually. The second project is by Suchi Semicon Private Limited, setting up an Outsourced Semiconductor Assembly and Test (OSAT) facility in Surat, Gujarat, with a projected annual production capacity of over 1 billion discrete semiconductor components. These projects are poised to create employment for around 2,230 skilled professionals. Furthermore, the central government has notified a Special Economic Zone (SEZ) for Tata Semiconductor in Dholera, Gujarat, facilitating the establishment of India's first semiconductor fabrication facility.
Strategic Partnerships and Technological Advancement
A landmark development in India's semiconductor ambitions is the strategic partnership between Tata Electronics and ASML, a leading Dutch semiconductor equipment manufacturer. Announced on May 16, 2026, this collaboration will see ASML provide its advanced lithography tools and solutions to support the establishment and ramp-up of Tata Electronics' upcoming 300 mm (12-inch) semiconductor fabrication plant in Dholera, Gujarat. This facility, with a planned total investment of US$11 billion, will manufacture semiconductors for diverse applications, including automotive, mobile devices, and artificial intelligence (AI). The partnership also emphasizes the development of local talent, supply chain resilience, and research and development infrastructure critical for the long-term success of India's nascent chip industry. This collaboration is a key component of India's strategy to build a comprehensive semiconductor value chain and reduce reliance on global supply chains, particularly from East Asian manufacturing hubs.
The government's commitment to fostering a self-reliant semiconductor ecosystem is further underscored by the announcement of ISM 2.0, which aims to bolster semiconductor equipment and materials manufacturing, alongside expanding full-stack design capabilities and indigenous intellectual property development. As India continues to attract significant investments and forge crucial international partnerships, the nation is positioning itself to become a key player in the global semiconductor landscape, driven by its vision of "Designed in India, Made in India". The coming years will be critical in observing the successful operationalization of these facilities and the impact on India's technological independence and economic growth.