The Indian government has greenlit the development of three new semiconductor units, signaling a significant leap in the country’s tech ambitions. Spearheaded by Tata Group and CG Power, these projects collectively represent a ₹1.26 lakh crore ($15.2 billion) investment. Construction is set to begin within the next 100 days, an assertive timeline that suggests India is serious about staking its claim in the global electronics supply chain.
Key Takeaways
- Tata Electronics will establish India’s first commercial semiconductor fabrication plant (fab) in Dholera, Gujarat.
- Tata Group will also build a semiconductor assembly and testing facility in Morigaon, Assam.
- CG Power, in a joint venture, is setting up a similar assembly and testing plant in Sanand, Gujarat.
- These projects add to the previously approved Micron Technology facility, also in Gujarat.
- All of this falls under the broader umbrella of the India Semiconductor Mission (ISM).
A New Chapter in Indian Manufacturing
For years, India has been deeply involved in chip design but remained heavily dependent on imports, primarily from Taiwan, South Korea, and China, when it came to manufacturing. That reliance has been both an economic burden and a potential strategic risk. Now, with these new facilities, India is clearly attempting to change that equation.
Leading the charge is Tata Electronics planned semiconductor fab in Gujarat’s Dholera Special Investment Region. The plant, being built in collaboration with Taiwan’s Powerchip Semiconductor Manufacturing Corp (PSMC), carries a price tag of ₹91,000 crore. Fabs like this one are essentially the heart of chip production, they turn silicon wafers into integrated circuits. Once operational, this facility is expected to handle 50,000 wafer starts per month and support multiple process nodes, including 28 nm, 40 nm, 55 nm, 90 nm, and 110 nm. These chips will be critical for everything from electric vehicles and high-power computing to telecom, defense, and everyday electronics.
The other two facilities approved under this round target what’s known as ATMP, assembly, testing, marking, and packaging. This stage of chip-making takes the finished wafers, slices them into individual chips, and packages and tests them before they’re sent off to manufacturers. It’s a different but equally vital part of the supply chain.
One of these ATMP units will be developed by Tata Semiconductor Assembly and Test Pvt Ltd (TSAT) in Morigaon, Assam. Backed by a ₹27,000 crore investment, this plant will focus on automotive-grade semiconductors and collaborate with global chipmakers to meet international demand.
The third facility, led by CG Power and Industrial Solutions Limited, is being developed in partnership with Japan’s Renesas Electronics Corporation and Thailand’s Stars Microelectronics. Located in Sanand, Gujarat, this ₹7,600 crore plant will cater to a wide variety of applications, from industrial motors and consumer electronics to automotive systems. Its projected output? About 15 million units per day, which is substantial by any measure.
All of this activity falls under the India Semiconductor Mission (ISM), a government-led initiative launched in 2021 by the Ministry of Electronics and Information Technology (MeitY). With an initial allocation of ₹76,000 crore, the mission aims to build a robust semiconductor and display manufacturing ecosystem in India. It’s about fostering self-reliance, certainly, but also about turning India into a magnet for global tech investment. And with these new approvals, it feels like that vision is starting to take shape, perhaps more tangibly than ever before.
Frequently Asked Questions (FAQs)
Q1: What is a semiconductor?
A1: A semiconductor is a material, typically silicon, that can conduct electricity under some conditions but not others. This property makes it an excellent medium for controlling electrical current and forms the basis of all modern electronic devices, acting as their “brain.”
Q2: What is a semiconductor fabrication plant (fab)?
A2: A semiconductor fab is a highly advanced factory where raw silicon wafers are converted into finished semiconductor chips through a complex process involving hundreds of steps. Tata’s Dholera plant is an example of a fab.
Q3: What is an ATMP facility?
A3: An ATMP (Assembly, Testing, Marking, and Packaging) facility handles the final stages of semiconductor production. It takes the finished wafers from a fab, cuts them, assembles the individual chips into casings, tests them for quality, and prepares them for use in electronic devices.
Q4: Which companies are setting up semiconductor plants in India?
A4: Tata Group is setting up a fab in Gujarat and an ATMP unit in Assam. CG Power, with its partners, is building an ATMP unit in Gujarat. This is in addition to the US-based Micron Technology’s ATMP plant already under construction in Gujarat.
Q5: Why is the Indian government focused on making chips?
A5: The Indian government is promoting domestic chip manufacturing to reduce its dependence on imports, secure its supply chain for critical electronic components, create high-skill jobs, and establish India as a key hub in the global electronics industry.
