India is increasingly becoming a significant player in the global semiconductor landscape, not through large chip manufacturing plants but due to its abundant engineering talent and expanding design capabilities. While countries like Taiwan and South Korea have traditionally led in semiconductor alliances with advanced fabrication facilities, India’s strength lies in its human resources, particularly in chip design and engineering, as per a report by Directus. The country is home to nearly 20% of the world’s integrated circuit (IC) design workforce, supported by a continuous influx of engineering graduates annually.
Global tech giants like Intel, NVIDIA, and Qualcomm have established major research and development centers in India, employing a substantial number of engineers who focus on chip design, verification, and embedded systems. This setup enables companies to enhance their operations efficiently at reduced costs. Although India is still in the nascent stages of developing high-end chip fabrication units, it is concentrating on the mid-stage of the supply chain, encompassing assembly, testing, marking, and packaging (ATMP).
One notable instance is Micron Technology, which is in the process of constructing a $2.75 billion facility in Gujarat. This strategic approach allows India to swiftly integrate into the semiconductor value chain while progressively enhancing capabilities for more advanced manufacturing, the report highlighted. The government is also intensifying efforts to fortify the sector through initiatives like the India Semiconductor Mission 2.0, aimed at nurturing design talent, supporting startups, and fostering a robust chip ecosystem.
A pivotal aspect of this endeavor is the Design Linked Incentive (DLI) Scheme, offering financial backing and essential tools and infrastructure for chip design and development. Notably, global companies are increasingly expressing confidence in India’s policy trajectory. Taiwan’s Powerchip Semiconductor Manufacturing Corporation, for instance, has joined hands with Tata Electronics to establish India’s maiden commercial wafer fabrication plant in Gujarat, with an investment of approximately $11 billion.
