India’s Semiconductor Ambition: A Game-Changer in the Global Tech Race

The world is currently engaged in what could be called the "semiconductor war." Major global powers, particularly the United States and China, are battling for dominance in the manufacturing of semiconductor chips, which are the backbone of modern technology. From powering smartphones and cars to supporting defense systems and AI, semiconductors are integral to nearly every industry today. The country that controls chip manufacturing will hold the keys to the future.

For India, a country heavily reliant on semiconductor imports, this dependency has raised significant concerns. With nearly all of its semiconductor supply coming from countries like Taiwan, South Korea, China, and the United States, India faces vulnerabilities if geopolitical tensions escalate. A sudden supply disruption could lead to the collapse of critical sectors such as electronics, automotive, and defense. This is why the Indian government is placing a strong focus on creating a robust domestic semiconductor ecosystem.

A Strategic Shift: India’s Drive for Self-Sufficiency

In 2025, India is set to roll out its first homegrown semiconductor chip, marking a significant milestone in its technological journey. This achievement follows years of groundwork, including a $10 billion incentive program launched in 2022 aimed at establishing a semiconductor industry from scratch. India’s ambition to produce its own chips is not just about reducing dependence on imports—it is about safeguarding national security, boosting economic growth, and enhancing technological capabilities.

As part of the initiative, the government has introduced semiconductor-specific policies, partnered with top global firms, and significantly increased investments in research and development. The push has already resulted in the construction of three new semiconductor plants, two in Gujarat and one in Assam, with Tata Group playing a leading role. Additionally, Micron Technology, a U.S.-based semiconductor giant, has committed to building a $2.75 billion plant in India.

Why This Is a Game Changer

The importance of semiconductors cannot be overstated. Today, nearly every modern industry relies on chips, from consumer electronics to the defense sector. During the pandemic, the world saw the consequences of a global chip shortage—car production slowed down, electronics manufacturing faced delays, and entire industries were at risk of grinding to a halt. India’s growing electronics, automotive, and defense industries are directly impacted by these shortages, which is why building a domestic semiconductor manufacturing ecosystem is critical.

India’s push to establish a self-sufficient semiconductor supply chain is expected to position the country as a significant player in the global market. The global semiconductor market is currently worth over $600 billion, and India aims to capture a $13 billion share by 2030. This ambitious goal is attainable if the right steps are taken to foster growth in the semiconductor sector.

The Existing Strengths and Key Players

While India has struggled with semiconductor fabrication (the physical production of chips), it already has a strong semiconductor design ecosystem. Indian companies like TCS, Wipro, and HCL have been involved in designing chips for decades. The new push is focused on bridging the gap between design and fabrication, creating the necessary infrastructure to produce chips locally.

Big industry players are also eyeing India’s semiconductor market. Companies like Bat Forge are focusing on niche semiconductor segments related to automotive and defense industries. India is not attempting to compete directly with established semiconductor powerhouses like Taiwan or the U.S. Instead, it is targeting specific markets where it can have a significant impact, such as automotive, mobile, and defense semiconductors.

Government Support and Investments

The Indian government has already made a massive commitment to this sector. With a $10 billion (₹76,000 crore) Production Linked Incentive (PLI) scheme launched in 2021, India is making it clear that it is serious about becoming a global semiconductor manufacturing hub. This PLI scheme, coupled with tax breaks, policy tweaks, and regulatory reforms, is expected to attract foreign semiconductor giants to set up operations in India.

The government’s involvement in the semiconductor sector is already showing positive results. International participation in India’s semiconductor events has increased by four times, reflecting a growing global interest in the country’s semiconductor future. The massive incentives and reforms are positioning India as a competitive destination for semiconductor manufacturers, and the industry’s momentum is building rapidly.

India’s Electronics Growth: Mobile Manufacturing Milestones

India’s semiconductor push is already benefiting its broader electronics manufacturing ecosystem. In December 2024, India’s electronics exports reached a record $3.58 billion, marking a 35% increase from the previous year. Mobile phones have been a significant driver of this growth, with Apple doubling its production in India in just one year. By 2025, 25% of iPhones will be made in India—a huge leap for the country’s manufacturing sector.

For the first time ever, India-made iPhones were available globally within days of their launch, a significant milestone in the “Make in India” initiative. These developments reflect India’s growing influence in global electronics manufacturing, and the semiconductor push is expected to provide a foundation for even greater success in the coming years.

India’s Semiconductor Future: Can We Compete with Taiwan, South Korea, and the U.S.?

India’s semiconductor aspirations are ambitious, and the government’s vision is to achieve in 10 years what China accomplished in 30. The goal is to become a major player in the global semiconductor market, but challenges remain. Competing with established giants like Taiwan, South Korea, and the U.S. is no easy task. These countries have decades of experience and cutting-edge technology in semiconductor production. However, India’s focus on strategic investments, industry collaboration, and policy support puts it in a strong position to carve out its niche.

The next steps are crucial—India will need to focus on creating a competitive, sustainable semiconductor ecosystem, improving manufacturing capabilities, and attracting further investments. With the right policies and industry engagement, India can build a semiconductor industry that supports not only its own needs but also positions it as a key player in the global tech race.

Conclusion: The Beginning of India’s Semiconductor Journey

India’s semiconductor push is just beginning, but it is already clear that the country’s future in chip manufacturing is promising. By 2025, India will have its first homegrown semiconductor chip, and over the next decade, it could become a global semiconductor powerhouse. With continued government support, strategic investments, and industry partnerships, India is well on its way to reducing its dependency on imports and playing a significant role in shaping the global semiconductor landscape.

The future of India’s technology and electronics industries hinges on the success of this semiconductor push, and if all goes as planned, the country could soon join the ranks of global semiconductor leaders.