India is promising $23 billion to build a domestic semiconductor industry, with a major manufacturing plant planned in Gujarat by 2028 and a chip assembly facility in Assam expected to begin production in 2027.
The investment intends to expand local technology jobs, reduce dependence on China-linked supply chains and strengthen India’s technology partnership with the United States.
The investment marks a significant push to establish India as a semiconductor manufacturing destination at a time when countries are seeking greater control over their chip supply chains. The government is looking to build domestic capabilities through new facilities across several states, starting with chip assembly and testing.
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India’s $23 Billion Semiconductor Investment Targets Domestic Manufacturing
India’s semiconductor ambitions have faced challenges in the past, particularly inadequate infrastructure & complex regulatory requirements. Such factors have made it difficult to establish a competitive chip manufacturing ecosystem.
However, the country is now looking to build on its existing strengths, including a large pool of domestic chip designers, established connections with Silicon Valley and government support under Prime Minister Narendra Modi.
The $23 billion investment is intended to help India develop its own semiconductor industry rather than remain dependent on overseas manufacturing.
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Gujarat and Assam facilities to drive semiconductor expansion
Two projects are central to the expansion.
- Gujarat: A major semiconductor plant is under development and is expected to be ready by 2028.
- Assam: A semiconductor assembly facility is scheduled to begin production in 2027.
India is initially focusing on chip assembly and testing rather than building the entire manufacturing ecosystem at once.
The approach draws on the country’s experience in mobile phone assembly, particularly the growth of manufacturing facilities in Tamil Nadu. The government hopes to use a similar model to establish semiconductor operations across multiple states.
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India looks to reduce dependence on China and strengthen US ties
The investment has other wider economic and strategic objectives. India wants to create more technology jobs domestically while reducing its reliance on China-linked semiconductor supply chains.
Stronger technology ties with the United States are another part of this strategy. India’s existing links with Silicon Valley and its domestic chip-design talent are expected to support the sector’s development.
Government backing, including support from Prime Minister Narendra Modi through major industry conferences, is also helping advance the country’s semiconductor ambitions.
Progress on the Gujarat plant toward its 2028 target and the start of production at the Assam facility in 2027 will be key indicators of how quickly India can turn its semiconductor investment into domestic manufacturing capacity.
Samarjit Kaur is a journalist and communications professional covering technology & emerging digital trends. With a focus on clarity and context, she reports on developments shaping industries and governance. When not reporting, she chooses to plug-in and relax on her playlists and plan her next bucket-list trips!
