India's semiconductor push targets chips for cars, TVs, power infra: Vaishnaw
The government has outlined plans to expand India's semiconductor capabilities beyond chip assembly and testing into design, fabrication, equipment and materials
Chips for everyday products — cars, televisions, refrigerators — and for critical power infrastructure have been identified as priority target segments
The stated ambition includes building an ecosystem with several large chip manufacturers, multiple materials companies, and substantial direct employment over the coming years
This builds on the second phase of the India Semiconductor Mission, under which the government has committed a significantly expanded financial outlay to broaden the domestic ecosystem and attract global investment
India Semiconductor Mission (ISM) — Structure and Phases
The India Semiconductor Mission is the nodal government programme for building domestic semiconductor and display manufacturing capacity, administered by the Ministry of Electronics and Information Technology (MeitY) as an Independent Business Division within Digital India Corporation.
The minister's statement that India must move "beyond assembly and testing" reflects the explicit shift in emphasis from ISM 1.0 (which produced mostly ATMP/OSAT units) to ISM 2.0's broader coverage of fabrication, design and materials.
Semiconductor Value Chain — Design, Fabrication and ATMP/OSAT
The semiconductor industry is structured across distinct stages: chip design (fabless design houses create circuit layouts), fabrication (foundries manufacture chips on silicon wafers using processes measured in nanometres), and ATMP/OSAT (Assembly, Testing, Marking and Packaging / Outsourced Semiconductor Assembly and Test — packaging the finished chip and testing it for use). Most of India's operational projects so far are in the ATMP/OSAT stage, which is less capital-intensive than fabrication.
The push toward chips "for cars, TVs, power infra" aligns with the 28nm-class fabrication node India's first fab is targeting — these are mature, high-reliability nodes suited to automotive and appliance-grade chips rather than cutting-edge smartphone/AI processors.
Strategic Rationale — Supply Chain Resilience and Global Chip Geopolitics
Semiconductors have become a strategic technology given their concentration in a few geographies (Taiwan for advanced fabrication, limited hubs for equipment/materials) and their centrality to electronics, automotive, defence and power systems. Global supply disruptions (notably during 2020-2022) accelerated countries' efforts, including the US CHIPS and Science Act (2022) and similar schemes in the EU and Japan, to diversify fabrication capacity.
Building capability for "everyday product" and power-infrastructure chips reduces India's dependence on imported components for domestic electronics and automotive manufacturing, aligning with the broader Atmanirbhar Bharat (self-reliance) and PLI (Production-Linked Incentive) policy framework across the electronics sector.
- ISM 1.0 outlay (launched December 2021): ₹76,000 crore
- ISM 2.0 outlay (approved 2026): approximately ₹1.27 lakh crore
- Cumulative committed investment across approved ISM/SPECS projects (2026): approximately ₹1.64 lakh crore across 12-13 projects
- Tata Semiconductor's Dholera fab: India's first commercial fabrication facility, ~$11 billion project, 28nm node, first silicon targeted late 2026
- Micron's Sanand ATMP facility: first operational unit of the current mission cycle
- Ecosystem target: at least five large semiconductor manufacturers, three major materials companies, and over one lakh direct jobs