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India’s chip ambition takes flight with customers signing up
India's semiconductor push is moving beyond announcements and capital commitments, as global customers start to sign up for local manufacturing and assembly.
While the momentum so far has been policy-led, customers coming on board shows that India is increasingly being viewed as a workable link in global supply chains, experts said.
It also signals a fundamental shift – that the country is moving from basic assembly to high-value silicon production.
On December 8, American chip giant Intel tied up with Tata Electronics to explore manufacturing and assembling its products in India. Then, on December 22, Japanese semiconductor and electronics manufacturer Rohm said it was partnering with Tata Electronics for semiconductor manufacturing in India.
ET had also reported on December 17 that Apple was in preliminary talks with some Indian chip manufacturers to assemble and package the component for iPhones and that exploratory conversations had taken place with Murugappa Group-owned CG Semi.
“These are large global companies that will only come on board if they find that Indian firms are capable of producing quality products with a good yield while also being competitive,” IT secretary S Krishnan said, calling it a “sign of confidence and an endorsement.”
“This (semiconductors) is a space where there are some trade restrictions but there are no duties across the world, which means that price-wise, customers feel these companies are competitive and are good quality wise,” he told ET.
Tata Electronics and groups like CG Power and others have been “very strategic” in their approach by ensuring that they have customers lined up as this will be critical as these projects gain momentum, Krishnan said.
Parv Sharma, senior analyst at Counterpoint Research, said the Indian semiconductor story has evolved from being policy-focused in 2024 to establishing key alliances in 2025. This will be followed by setting up shop in 2026.
“The arrival of customers and alliances—such as the Tata-Intel partnership in December 2025—marks a critical global validation,” he said. “It signals that the ISM (India Semiconductor Mission) has moved from policy-level discussions to the threshold of final product manufacturing.”
Sharma said the next few years will witness the physical realisation of India's semiconductor ambitions.
“India is set to experience a snowball effect as first movers establish their supply chains, prompting others to follow and take advantage of the localised ecosystem. The country will offer power semiconductors to both homegrown and global automotive players like Tata, Mahindra, and Tesla,” he said.
Furthermore, major fabless players such as Qualcomm, MediaTek, and Nvidia — who already have a massive R&D presence in India — may explore local outsourced semiconductor assembly and test (OSAT) partnerships to serve the domestic market and de-risk themselves from global trade volatility, Sharma said.
Dhruv Shekhar, senior associate at Koan Advisory Group, said these partnerships matter because they signal that global players are willing to work with established Indian industrial groups that have a track record of executing complex, capital-intensive projects, rather than relying only on policy-backed greenfield ventures.
“We might see more customer engagement in 2026, but it will be selective rather than across the board,” he said. “The early traction will probably come from fabless firms, automotive and industrial electronics players, and system integrators, especially in areas like OSAT, advanced packaging, design services, and application-specific chips.”
Shekhar said full-fledged, cutting-edge logic manufacturing takes much longer to stabilise. Thus, in the near term, India's strengths are more likely to show up in mature nodes and specialised use-cases, where timelines, costs and risk profiles are more manageable.
Source: EconomicTimes
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