India's Semiconductor Push

India has a long history of almost making it in chip manufacturing. A fire at the Semiconductor Complex in Mohali in the 1980s killed the country's first shot at fabrication before it could scale. In the mid-2000s, Intel walked away after months of negotiation. These weren't just bad luck. Chip fabrication is brutally hard, ruinously expensive, and depends on ecosystems that take decades to build. India, for a long time, had none of the three.

The India Semiconductor Mission landed in December 2021 with ₹76,000 crore. Cautious optimism followed, then the familiar scepticism. When Vedanta-Foxconn fell apart in 2023, the pessimists seemed right: India would consume chips, not make them.

Then Micron opened its Sanand facility in Gujarat in March 2026. A $2.75 billion assembly and testing plant. India's first large-scale commercial semiconductor operation. 500,000 square feet of cleanroom, built to Class 1,000 standards, the largest raised-floor facility of its kind globally. The plant takes finished wafers from Micron's global network and turns them into DRAM and NAND: memory chips for laptops, servers, phones.

At full ramp, Sanand should handle about 10% of Micron's global packaging and test output. First shipments have gone out. Micron's made-in-India modules to Dell, for locally manufactured laptops.

The Tata-PSMC fab in Dholera is a bigger bet by an order of magnitude. ₹910 billion, roughly $9.78 billion. India's most ambitious semiconductor project. Construction hit 50% in April 2026. Trial production expected by late 2026. It will make 28nm and above chips, the kind that go into cars, industrial gear, telecom equipment. Not AI accelerators. The stuff the world actually runs on.

Six other approved projects, four more manufacturing units in Odisha, Punjab, Andhra Pradesh. Early stage, pipeline is filling.

The broader electronics shift is real too. Mobile phone imports have dropped nearly 77% since FY 2020-21. Over 99% of domestic demand is now met locally. The Electronics Component PLI scheme, announced April 2025 with ₹22,919 crore, already has 22 approved projects worth ₹41,863 crore: camera modules, display modules, PCBs. Across all 14 PLI sectors: cumulative investment over ₹2.16 lakh crore, exports ₹8.3 lakh crore, over 14 lakh jobs.

Scale is not the same as depth though.

The layers matter

The semiconductor value chain has distinct layers. Sanand works at the backend: assembly, testing, packaging. Wafers made elsewhere get diced, assembled, tested, shipped. Essential work. Not the hardest work.

Analysts estimate the complexity of an ATMP or OSAT facility at 20-30% of a front-end fab of similar scale. You still need reliable power and cleanrooms. You do not need nanoscale precision, ultra-pure chemical handling, or the multi-year yield learning curves that define real fabrication.

Dholera, if it delivers, would be India's first entry into front-end manufacturing. 28nm and above is multiple generations behind the 3nm and 5nm processes that power AI and premium phones. I don't think that's a flaw. Mature nodes serve enormous markets and demand is growing. Let's call it what it is: middle-tier ambitions. Not the frontier.

Compare India to established Asian hubs and the gap is sobering. Malaysia spent decades building integrated ecosystems: packaging firms, equipment makers, chemical suppliers, trained labour. Japan leads in semiconductor equipment and materials. The chemical resists, precision etching tools, substrate technologies are as strategically important as the chips. China, for all its geopolitical troubles, deploys technology, talent, and capital at a scale India cannot currently match.

India's advantages today are still largely policy-driven and geopolitically enabled. Not ecosystem-led.

The window

US-China decoupling opened a door India did not earn but can walk through. Multinationals want diversification away from Taiwan, South Korea, and China. India is in the running alongside Vietnam, Malaysia, and Mexico.

This is genuinely favourable but also temporary. Once the current restructuring settles, first-mover advantages harden and late entrants compete for scraps.

Semiconductor investments are 15 to 20 year bets. Companies look past headline subsidies to policy continuity, infrastructure reliability, supplier ecosystems, talent pipelines. Micron proved that within a controlled industrial zone, India can deliver reliable power, water, land access, and regulatory coordination. The real test is whether that works across multiple states and scales to the more demanding requirements of fabrication plants.

People

The most encouraging signal from Sanand is not the cleanroom size. It is the people. Of nearly 1,300 employees, about 700 are fresh graduates from Gujarat and neighbouring states: electronics, mechanical, chemical, industrial, materials engineers. They spent 3-6 months training at Micron's facilities in Malaysia and Singapore before coming back to run the plant.

This is not a jobs statistic. It is the early formation of a skilled workforce that seeds future investments. Each trained engineer makes the next project easier to staff. That compounds in ways a power plant or a tax break cannot.

Realistic success

Self-sufficiency is not in the cards. The global chip supply chain is too complex, too capital-intensive, too interdependent. Even the United States, with the CHIPS Act and decades of leadership, is not trying to manufacture everything domestically.

The realistic goal is to become a meaningful node in the global chain, not a dominant one. That means backend capacity to attract more investment, proving front-end fabrication can work here, developing a supplier base, and building a talent pipeline.

The first is happening. The second hinges on Tata-PSMC over the next 18-24 months. The other two have barely started.

What I think

I have been watching India's semiconductor story for years, and the pattern has always been the same: announcements, optimism, then nothing. This time feels different, not because the government is trying harder, but because there is finally something physical to point at. A plant running. Modules shipping. Engineers trained.

The gap is still enormous. Backend manufacturing is a start, not an end. Mature-node fabrication is necessary but not the frontier. The geopolitical window is real but will not stay open forever.

Here is what has changed: India finally has a basis for the next attempt. After four decades of almost-making-it, that counts for something.