New DelhiMicron and Kaynes’ Indian fabs are sold out.
Phase one of India’s semiconductor mission closes with 12 approved units and ₹1.65 lakh crore (~$20bn) committed, Technology Minister Vaishnaw said.
Phase two, India Semiconductor Mission 2.0, is now being prepared with an expected outlay above ₹1 lakh crore.
Sources: Hindustan Times
WHY INDIA STARTED LATE
India produces roughly 20% of the world's chip design engineers but fabricated almost no silicon domestically until 2024. Design is weightless — emailed to Taiwan. Fabrication requires billions per fab, ultra-pure water, uninterrupted power, and a vendor ecosystem India never built during the 1990s liberalization window.
PACKAGING FIRST, FABS LATER
Eleven of the twelve approved units are assembly, test, and packaging (ATMP) plants — not leading-edge fabs. This is the standard playbook: packaging needs less capital, less process know-how, and trains a workforce before the country attempts sub-10nm lithography. Micron's Sanand plant in Gujarat is the flagship.
THE SUBSIDY MATH
India covers 50% of project capex for approved fabs and packaging plants, with states adding another 20-25%. A $2.75bn Micron plant lands roughly $1.5bn in central money plus state incentives. No country has built a domestic semiconductor industry without subsidies on this scale — Taiwan, Korea, China, and the US CHIPS Act all follow the same template.
THE PEER RACE
India is one of several countries pouring state money into chips after the 2021 supply shock revealed Taiwan as a single point of failure. The absolute commitments are not comparable to TSMC or Samsung's annual capex, but the strategic intent is.
THE NODE GAP
India's first true fab — Tata-PSMC at Dholera — will produce 28nm and 40nm chips. TSMC is shipping 3nm in volume and ramping 2nm. The 28nm node is a generation behind 2011, but it covers automotive, industrial, and power-management chips that account for the bulk of unit volume even if not value.
WHY GUJARAT
Three of the major projects landed in Gujarat — Micron, Tata-PSMC, and Kaynes — for one structural reason: the state offers fast land acquisition, dedicated industrial water from the Narmada canal, and a single-window clearance system that Tamil Nadu and Karnataka have struggled to match. Gujarat's chief minister also chairs the state's semiconductor task force directly.