India Plans $11B Fund to Boost Domestic Chipmaking

• India plans new $11B semiconductor fund
• Scheme to expand the chip manufacturing sector
• Builds on the 2021 semiconductor incentive plan

India is preparing a new multi-billion-dollar fund to support the development of its semiconductor sector as the government seeks to expand domestic chip manufacturing and strengthen supply chains.

According to reports, the Government of India is considering the creation of a fund worth about $11 billion to encourage semiconductor companies to establish manufacturing facilities in the country. The fund would provide subsidies to support chip factories, semiconductor technology development and the expansion of the local supply chain. The proposal is currently under discussion and has not yet been finalised.

Semiconductors are essential components used in a wide range of products, including smartphones, laptops, automobiles, defence systems and artificial intelligence infrastructure. Rising global demand for these technologies has led several countries to increase investment in domestic semiconductor production.

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India’s proposed initiative reflects broader global competition to strengthen semiconductor supply chains and reduce dependence on imports. Governments across major economies have introduced funding programmes to attract chipmakers and support domestic manufacturing capabilities.

The plan also aligns with the government’s broader strategy to expand India’s role in global technology manufacturing. Prime Minister Narendra Modi has previously emphasised the importance of developing a domestic semiconductor ecosystem as part of the country’s industrial and digital development plans.

Union Minister for Electronics and Information Technology Ashwini Vaishnaw has also highlighted the goal of positioning India as a major semiconductor hub by 2030.

The proposed fund is expected to build on India’s earlier $10 billion semiconductor incentive programme launched in 2021. Under that scheme, the government offered financial support covering up to 50 per cent of the cost of semiconductor manufacturing projects.

The earlier programme attracted investment commitments from companies including Micron Technology and Foxconn. The Tata Group has also announced plans to establish a semiconductor manufacturing facility in Gujarat as part of the broader push to develop the sector.