India is aggressively pursuing self-reliance in semiconductor manufacturing, aiming to become a significant global player. The government has launched ambitious programs, approved numerous projects, and committed substantial financial resources to achieve this goal. While comparisons to established industry giants like NVIDIA might seem premature, India's strategic approach and growing capabilities suggest a promising future in the semiconductor sector.

Government Initiatives and Investments

The Indian government has demonstrated a strong commitment by approving the India Semiconductor Mission (ISM) with a ₹76,000 crore (approximately $9.2 billion USD) outlay. This mission aims to boost fabrication, design, and manufacturing within the country. The government has also launched a Production Linked Incentive (PLI) scheme, offering financial incentives to companies that establish semiconductor and display manufacturing facilities in India. Approximately 97% of the ₹65,000 crore allocated for chip production has already been committed. Furthermore, the Design Linked Incentive (DLI) Scheme supports startups, MSMEs, and academic institutions involved in chip design and development. These initiatives aim to create a comprehensive ecosystem, encompassing manufacturing, design, and research and development.

Key Projects and Developments

Several significant projects are underway across India:

• Tata Electronics, in partnership with Powerchip Semiconductor Manufacturing Corporation (PSMC), is investing INR 910 billion (~US$11 billion) to build a mega semiconductor fabrication facility in Dholera, Gujarat. The fab will have a capacity of producing up to 50,000 wafers per month and is expected to create over 20,000 skilled jobs.
• Micron Technology is constructing a semiconductor assembly and test facility in Gujarat, with an investment of $2.75 billion.
• HCLTech and Foxconn have partnered to establish an outsourced semiconductor assembly and testing (OSAT) plant.
• Tower Semiconductor, in collaboration with the Adani Group, is planning to set up a chip manufacturing plant in Panvel, Maharashtra.
• ARM has inaugurated a design office in Bengaluru, focusing on next-generation 2-nanometre chip technology.

Prime Minister Narendra Modi announced that India will launch its first fully domestically manufactured semiconductor chips by the end of 2025.

India's Strengths

• Design Talent: India possesses a significant advantage with its large and skilled engineering workforce, representing approximately 20% of the global design talent pool.
• Growing Market: The Indian semiconductor market is projected to reach $100-110 billion by 2030, driven by increasing demand from various sectors, including electronics, automotive, telecommunications, and AI.
• Government Support: The government's proactive policies, incentives, and investments are creating a favorable environment for the growth of the semiconductor industry.
• Strategic Focus: India is focusing on specific areas, such as legacy chips, analogue chips, and silicon carbide manufacturing, to build a competitive edge.

Challenges and Opportunities

Despite the progress, India faces several challenges:

• Competition: The semiconductor industry is dominated by established players like Taiwan, South Korea, and the United States.
• Infrastructure: Developing robust infrastructure and ensuring a stable supply chain are crucial for success.
• Skilled Workforce: Addressing the shortage of skilled labor is essential to meet the growing demands of the industry.
• Access to Finance: Limited access to finance can hinder the growth of domestic companies.

To overcome these challenges, India needs to:

• Foster Innovation: Encourage research and development to create innovative chip designs and technologies.
• Promote Collaboration: Facilitate partnerships between domestic and international companies to leverage expertise and resources.
• Invest in Education: Expand education and training programs to develop a skilled workforce.
• Streamline Regulations: Simplify regulations and procedures to attract investments and promote ease of doing business.

While replicating NVIDIA's success is a long-term aspiration, India is making significant strides in building a robust semiconductor ecosystem. With sustained government support, strategic investments, and a focus on its strengths, India has the potential to emerge as a key player in the global semiconductor industry.