India’s push to build a domestic semiconductor and data centre ecosystem could get a meaningful boost from the interim trade framework announced by New Delhi and Washington, according to Pan IIT Alumni India, which sees the agreement as a catalyst for deeper technology collaboration and supply chain resilience.

The alumni body said the framework, read alongside policy support announced in the Union Budget, creates a favourable backdrop for India’s ambitions in chip manufacturing, advanced electronics and digital infrastructure. At a time when global companies are reassessing supply chains and looking beyond China, closer technology engagement with the US could help India move faster across the semiconductor value chain.

Also read: India can lead in advanced chip design, says Ashwini Vaishnaw as Qualcomm reveals 2nm chip

“The trade framework and the Union Budget together reflect a clear strategic alignment. India is building domestic capacity while expanding global technology partnerships,” said Prabhat Kumar, chairman of Pan IIT Alumni India.

India has been pushing to attract investments across semiconductor fabrication, packaging and design through production-linked incentives and targeted policy measures. Access to advanced components and know-how, the alumni body said, is critical as chips increasingly underpin sectors ranging from data centres and telecom to electric vehicles and defence manufacturing.

“Today, everything runs on chips — from data centres and telecom networks to electric vehicles and defence systems,” Kumar said. “Stronger engagement with the US can help India move faster from design to manufacturing and packaging, while reducing supply chain risks.”

Budget support sharpens focus on data centres

Pan IIT Alumni India also pointed to measures in the Union Budget that it said complement the trade framework, particularly steps aimed at expanding India’s data centre footprint. Among them is a proposed tax holiday until 2047 for foreign cloud service providers using Indian data centre infrastructure, a move intended to draw long-term global capital into the sector.

Also read: Budget 2026: The need to boost data centre investments in India

“The trade framework improves access to advanced technology and markets, while the Budget builds the domestic foundation,” Kumar said. “Together, they create momentum for sustained growth in advanced manufacturing and digital infrastructure.”

Beyond large manufacturers, the alumni body said startups and MSMEs could benefit from smoother cross-border collaboration, better access to capital and integration into global value chains. It highlighted the role of India’s extensive IIT alumni network in the US, spanning technology firms, startups and venture funds, in facilitating partnerships and market entry.

“From electronics and EV components to defence and aerospace, reliability matters,” Kumar said. “This framework strengthens India’s position as a trusted manufacturing and innovation partner under the evolving China+1 strategy”.

Pan IIT Alumni India said it plans to leverage its global network to translate the policy momentum into concrete outcomes through mentoring, technology partnerships and cross-border investments, working with industry, academia and policymakers.