India’s ambition to be at the epicenter of the global semiconductor value chain is charging ahead—but with a refreshingly pragmatic twist. Rather than entering the resource-intensive race for cutting-edge 3nm or 5nm chips, the Indian government is making significant investments in mature-node semiconductor manufacturing, targeting the ubiquitous 28nm–65nm segment. This strategic pivot is designed not merely to catch up—but to fill critical global supply chain gaps, power domestic industries, and anchor India firmly in the evolving “China+1” world order.
Why Focus on Mature Nodes?
Mature-node semiconductors may not command the headlines like their bleeding-edge cousins, but they form the backbone of modern industry. Chips based on 28nm to 65nm processes are integral to everyday products—automotive computers, telecom equipment, industrial machinery, and medical devices. With over 60% of global semiconductor demand coming from this category, and top suppliers like TSMC and Samsung prioritizing advanced nodes, India’s bet on these essential chips is proving both timely and shrewd.
Landmark Investments and Approvals
Semicon India Programme: Launched in 2021, this mammoth incentive drive has allocated ₹76,000 crore (US$9.5 billion) to catalyze local chip production, focusing heavily on mature-node and ATMP (Assembly, Testing, Marking, Packaging) capacity.
Ten major projects have been cleared to date, across six states, totaling investments of ₹1.6 lakh crore (US$18.2 billion). Four new projects—worth ₹4,600 crore—are underway in Odisha, Andhra Pradesh, and Punjab, reflecting the pan-India reach of this vision.
Six semiconductor plants are already greenlit, with the latest—near Jewar Airport in Uttar Pradesh—created through a landmark HCL-Foxconn joint venture. Gujarat, India’s leading chip destination, is home to four of these projects, with major industry names like Tata Electronics, Micron Technology, and Renesas participating.
First “Made in India” Chips: Prime Minister Narendra Modi recently announced that India’s first indigenous semiconductors will be market-ready by year-end, marking a watershed moment for the country’s technological self-sufficiency.
Strategic Benefits for India—and the World
Supply Chain Security
India’s focus on mature nodes comes as global manufacturers seek alternatives to China in response to geopolitical risks. As an emerging, trusted supplier of essential chips, India is well positioned to capitalize on the “China+1” trend, winning both new investment and diversification deals.
Boosting Domestic Industry
By nurturing homegrown supply, India aims to meet the surging demand in core sectors:
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Automotive: Infotainment, safety, and control chips
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Telecom: Networking, connectivity infrastructure
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Industrial & Medical: Control, diagnostic, and operational systems
The reduction in import reliance not only saves foreign exchange but creates powerful incentives for global giants to “Make in India” for both local and export markets.
Building Tech Ecosystem and Jobs
With mature-node production as anchor, India is rapidly scaling up on design, packaging, and R&D, complementing manufacturing with a push for indigenous chip IP creation, standards development, and ecosystem deepening. Estimates suggest thousands of direct and indirect jobs with each new fab, alongside hundreds of startups emerging in chip design and embedded electronics.
Key Challenges and the Road Ahead
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Complex Value Chains: Fabs are just one piece; India is also investing in raw materials, chemicals, water, and power infrastructure for truly integrated supply.
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Long-Term Vision: As in the 1970s for Taiwan and South Korea, India must maintain steady policy support, timely fund disbursement, and market certainty to keep investments flowing.
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Upward Mobility: After mastering mature nodes, the nation’s next leap—already in planning—will be technology partnerships and upgrading to sub-28nm nodes in the coming decade.
Conclusion: A New Dawn for India’s Chip Dream
By playing to its strengths and matching national needs with global reality, India is rewriting its semiconductor story—not as a follower of the last digital revolution, but as an indispensable partner for the industries driving the next one. With “Made in India” chips expected in the market by end-2025, the country’s measured ambition could prove to be its unique advantage.
Sources: Economic Times, India Briefing, Awaz The Voice, PIB, Times of India, NewsBytes, HDFC Fund Knowledge Stack
