From Silicon Dependence to Strategic Sovereignty: Bharat's Semiconductor Turnaround

 

For decades, Bharat remained one of the world's largest consumers of electronics but had almost no domestic semiconductor manufacturing capacity. The chips that powered mobile phones, computers, automobiles, defence platforms and digital infrastructure were overwhelmingly imported. Between 2014 and 2026, however, Bharat embarked on a determined transformation, moving from import dependence towards building an indigenous semiconductor ecosystem.

 

This transition is not accidental. It is the result of a decade-long strategic policy push that combines industrial policy, technological ambition and the objective of national self-reliance.

 

 

Semiconductors form the backbone of the modern technological economy. These tiny electronic components, manufactured primarily from silicon, control the flow of electricity and enable the functioning of microprocessors, sensors and memory chips. Every smartphone, data centre, automobile, satellite and defence system depends on semiconductor chips.

 

Recognising their strategic importance, Bharat's leadership began treating semiconductors not merely as an industrial sector but as a critical component of technological sovereignty. The disruptions caused by the global chip shortage between 2020 and 2022 further underscored the vulnerability created by import dependence.

 

Consequently, Bharat initiated a structured effort to build domestic capabilities across the semiconductor value chain, including design, fabrication, packaging, testing and supply chain infrastructure.

 

 

A defining moment in this journey came on 1 March 2026, when Prime Minister Narendra Modi inaugurated Bharat's first semiconductor facility at Sanand in Gujarat.

 

 

The facility, established by Micron Technology, represents an investment of ₹22,516 crore and operates as an Assembly, Testing, Marking and Packaging (ATMP) unit. It will manufacture memory products including Solid State Drives (SSDs), DRAM and NAND storage solutions.

 

Although it is not yet a full fabrication plant, the Sanand facility marks a crucial first step in building a domestic semiconductor manufacturing ecosystem. It demonstrates that Bharat's semiconductor policy framework has moved beyond conceptual planning and entered the phase of real industrial execution.

 

 

At the centre of Bharat's semiconductor transformation is the India Semiconductor Mission (ISM), launched in 2021 with a financial outlay of ₹76,000 crore.

 

The mission was designed as a comprehensive initiative to establish a full-stack semiconductor ecosystem. Under ISM 1.0, the government offered fiscal support covering up to 50 percent of project costs for:

 

 

 

 

 

 

By December 2025, the government had approved ten semiconductor-related projects across six states, representing a combined investment of approximately ₹1.6 lakh crore. These projects include fabrication units, advanced packaging facilities, silicon carbide fabs and specialised testing infrastructure.

 

 

In the Union Budget for 2026–27, the government announced the next phase of the mission, ISM 2.0.

 

 

While the first phase focused primarily on establishing manufacturing infrastructure, the second phase aims to deepen Bharat's technological capabilities. The focus areas include:

 

 

 

 

 

 

By shifting the emphasis from assembly to technology development, ISM 2.0 seeks to ensure that Bharat becomes not merely a manufacturing base but a knowledge-driven semiconductor power.

 

 

Another landmark moment came in September 2025, when Bharat unveiled "Vikram", the country's first fully indigenous 32-bit microprocessor.

 

 

Developed by ISRO's Semiconductor Laboratory in Mohali using 180nm CMOS technology, the chip was successfully validated during the PSLV-C60 mission in 2024.

 

The development of Vikram represents a symbolic milestone for Bharat's technological confidence. It demonstrates that Bharat possesses the research capabilities required to design and validate advanced microprocessors domestically.

 

 

Bharat's semiconductor progress is anchored within a broader industrial policy framework launched over the past decade.

 

The Make in India initiative, launched in 2014, aimed to transform Bharat into a global manufacturing hub by improving the ease of doing business and opening key sectors to foreign investment.

 

This was followed by complementary initiatives such as:

 

Digital India (2015) – building digital public infrastructure

 

Startup India (2016) – promoting entrepreneurship and innovation

 

National Policy on Electronics 2019 – targeting global leadership in electronics manufacturing

 

In 2020, three major schemes further strengthened the electronics manufacturing ecosystem:

 

 

 

 

Together, these policies created an enabling environment for semiconductor investments.

 

 

Semiconductor design accounts for nearly 50 percent of the total value addition in the industry. Recognising this, the government introduced the Design Linked Incentive (DLI) Scheme in 2021.

 

The scheme supports fabless semiconductor startups by offering:

 

 

 

 

So far, 24 chip design projects have been approved across sectors such as:

 

 

 

 

 

These initiatives have produced multiple ASIC chips, patents and tape-outs while supporting more than 1,000 semiconductor engineers.

 

 

Bharat's semiconductor ambitions are being strengthened through a network of global collaborations and strategic alliances. Bharat has signed partnership agreements with the European Union, Japan, Singapore and Purdue University, enabling technology transfer, joint research, talent exchange and deeper integration into resilient global semiconductor supply chains. Such partnerships are particularly important at a time when geopolitical competition increasingly revolves around control over advanced semiconductor technologies.

 

 

At the same time, Bharat's semiconductor push is being driven by the rapid expansion of its electronics manufacturing sector. Electronics production has grown from ₹1.9 lakh crore in 2014–15 to ₹11.3 lakh crore in 2024–25. Mobile phone manufacturing has also surged dramatically, making Bharat the world's second-largest smartphone producer.

 

With government initiatives aiming to build a $500 billion electronics ecosystem by 2030, domestic demand for semiconductor components is expected to rise significantly. The emerging semiconductor ecosystem is also projected to generate major economic and strategic benefits, including the creation of up to one million jobs by 2026.

 

 

Indian semiconductor startups are already developing chips for artificial intelligence, automotive electronics and communication systems. At the same time, reduced reliance on imported chips will strengthen Bharat's strategic resilience in critical sectors such as defence, telecommunications and space technology.

 

 

 

Kewali Kabir Jain