India's chip mission grows to $13.5 billion as plants start output

What happened

SEMICON India 2026 ran from 17 to 19 September at the Yashobhoomi convention centre in New Delhi. It was the fifth edition, organised by the India Semiconductor Mission, India's electronics ministry and SEMI, the global chip industry association. Business Today counted more than 600 exhibitors, about 300 of them international. The Tribune reported representatives from 52 countries, six country pavilions, 12 state booths, a startup pavilion, a student hackathon and a workforce development pavilion.

Modi said each SEMICON India since 2022 has marked a step: first policy, then projects and foundation stones, then pilot lines and test chips, and now commercial production. He said chips made in Indian plants are now reaching customers in India and abroad. According to government data cited by Business Today, 12 chip projects have been approved and three were in commercial production before the event. The Tribune reported that production started at two more plants during the event.

EE Times, writing on 23 September, named the two new lines. CDIL Semiconductor in Mohali, Punjab, makes discrete devices, and Suchi Semicon in Surat, Gujarat, does packaging. EE Times reported that all five producing plants are back-end units for assembly, test, marking and packaging, and none is a wafer fab. Micron's chief executive said commercial memory production is under way at its plant in Sanand, Gujarat. India's first commercial wafer fab, built by Tata Electronics in Dholera, Gujarat, is still under construction.

EE Times also reported comments from India's electronics minister, Ashwini Vaishnaw. He said the assembly and test units are shipping to Japan, and that Indian-made parts are going into products exported to the United States and to European countries such as Switzerland and Germany. Tata announced a deal to prepare the Dholera fab to make MOSFET transistors for the chipmaker Nexperia, though no volumes or dates were disclosed. Vaishnaw said one fab due to start production in 2028 has already booked a large share of its capacity.

The engineering behind it

Making a chip has two broad halves. The front end, called fabrication, takes place in a wafer fab. Patterns of transistors and wires are printed onto thin silicon wafers through hundreds of steps of deposition, lithography and etching, in extremely clean rooms. The back end takes the finished wafer, tests each chip on it, cuts it into individual dies, puts each die in a protective package with connecting pins, and tests it again. This is general industry knowledge, and it explains why the two halves need very different investment.

A modern wafer fab costs many billions of dollars and needs years to build, a steady supply of special chemicals and gases, very stable electricity and large amounts of pure water. Assembly and test plants cost much less and can start faster. That is why many countries start with the back end and add fabs later. Advanced packaging, which joins several dies inside one package, has also become more important as chips are split into smaller chiplets.

The second phase of the mission covers six areas: chip design, equipment and materials, fabrication, advanced packaging, research and talent. EE Times reported supporting announcements at the event. Lam Research, an equipment maker, plans about 10,000 crore rupees for its first component plant in India. Applied Materials announced a 5 billion dollar plan over ten years. Tata signed agreements with chemical and gas suppliers for Dholera. EE Times pointed out that many of these figures are commitments, not money already spent.

What it means in Nepal

The sources say nothing about Nepal, so this section is about the kind of work the industry needs. EE Times reported that India has trained about 70,000 chip design engineers in four years, against an original target of 85,000 over ten years. It also reported a target of 200 chip design startups, with 105 startups given access to design software in the first phase. Those numbers show that chip design is a large activity in its own right, separate from fabrication.

Chip design is mostly work at a computer. Engineers describe circuits in hardware description languages, simulate them, check that they behave correctly, and prepare the layout for a fab that may be in another country. Test and packaging plants need different engineers: people who understand electronic devices, measurement, signal quality, heat and reliability. Both kinds of work start from the same base of digital logic, electronic devices and circuits.

For a student, the useful conclusion is about skills, not about any one country's plans. A neighbouring country is spending billions of dollars on this industry, and its own reporting shows that design and testing are where most engineers are needed early. Students who build solid foundations in digital design, analogue circuits and embedded systems will understand the work, wherever they later choose to do it.