Thu Dec 18 02:22:07 UTC 2025: Here’s a summary of the text and a rewritten version as a news article:
Summary:
India is making a concerted effort to establish itself as a global manufacturing hub for semiconductors, aiming to attract companies seeking alternatives to China. The government has launched a $10 billion incentive program to support the development of chip fabrication and assembly, testing, and packaging (ATP) facilities. Key projects include a commercial foundry for mature chips in Gujarat, a collaboration between the Tata Group and Powerchip Semiconductor Manufacturing Corporation (PSMC) and ATP facilities by Micron and Tata. While these projects represent significant progress, they face delays and focus primarily on mature chips (28nm-110nm), not the cutting-edge technology. Experts emphasize the need for continued government support, foreign partnerships, and improvements to the overall business environment to compete effectively and advance towards producing more advanced chips. Concerns include political donations by companies after securing government subsidies, competition from China and Malaysia, and tariffs and trade uncertainties with the US.
News Article:
India Aims to Chip Away at China’s Semiconductor Dominance
New Delhi, India – India is making a bold move to become a major player in the global semiconductor industry, positioning itself as an alternative manufacturing hub to China. Fuelled by a $10 billion government incentive program, the country is attracting foreign investment and fostering domestic projects to boost chip fabrication and assembly, testing, and packaging (ATP) capabilities.
The cornerstone of this initiative is a planned $11 billion commercial foundry in Gujarat, a collaboration between India’s Tata Group and Taiwan’s Powerchip Semiconductor Manufacturing Corporation (PSMC). The foundry has also secured Intel as a potential customer. This project, slated to begin production as early as December 2026, is designed to produce mature chips ranging from 28nm to 110nm.
In October, Kaynes Semicon, an electronics manufacturer in Gujarat, shipped chip modules to California to a client, marking a first for India.
Other key developments include planned ATP facilities by Micron Technology and the Tata Group, focused on assembly and packaging. However, some projects are facing delays, pushing back initial production timelines.
Experts caution that India faces significant challenges in catching up with global leaders like Taiwan and China, particularly in cutting-edge chip technology. Stephen Ezell of the Information Technology and Innovation Foundation (ITIF) notes that while progress has been made, continued government support, attracting foreign partners, and improving the business environment are crucial for sustained success.
Concerns have also been raised regarding large political donations made by the Tata Group and the Murugappa Group to the ruling Bharatiya Janata Party (BJP) after they were selected for the subsidized projects. Both groups donated billions of rupees to Modi’s party after securing government subsidies in February 2024, according to Scroll.in. Both groups declined to comment to Al Jazeera regarding the reports.
India’s ambitions also face headwinds in the form of potential tariffs from the US and competition from other Asian nations like China and Malaysia.
Despite these challenges, India’s government remains committed to supporting the semiconductor sector, with plans for a second round of incentives. The goal is not simply to shift manufacturing from China but to capture the growing global demand for chips.
“We’re looking at capturing the incremental demand emerging both in India and abroad,” says Ashok Chandak, president of the India Electronics and Semiconductor Association (IESA).
Whether India can overcome these hurdles and establish itself as a major force in the semiconductor industry remains to be seen, but the current initiatives represent a significant step towards achieving that goal.
First Piper 