India’s semiconductor plants now competing globally on cost, quality: Ashwini Vaishnaw

India’s semiconductor manufacturing units that have begun commercial production are already competing with global players on cost and quality, Union Electronics and IT Minister Ashwini Vaishnaw said on Thursday, adding that production from the facilities is already booked as capacity expands rapidly.

Vaishnaw said India has received investment commitments of around ₹1 lakh crore or $11–12 billion, since the launch of Semicon 2.0. The commitments span capital equipment, materials, gases, chemicals, assembly, testing and packaging, with companies expected to announce individual investments as their boards and shareholders approve them. He said a significant portion of these investments is expected to materialise over the next two to three years.

Speaking to the media in a briefing at Semicon India 2026, Vaishnaw noted ensuring that India’s semiconductor projects could compete globally had been a key consideration from the beginning of the India Semiconductor Mission. “When we started this journey, one of the things which was always on the mind was both on quality and cost, we would have to compete with the world,” Vaishnaw said.

He said the government had assessed the ability of applicants to compete in the global semiconductor market while selecting projects, given that the industry is not limited to the Indian market. “This is not a market which is limited to India or limited to any particular geography. This is a market which is a global market and unless and until you stand up, both on quality and cost, you cannot really compete in the world,” he said.

Vaishnaw said the focus on competitiveness had continued from project selection and construction through to commercial production. According to him, five semiconductor companies are now at the commercial production stage, with the output and capacity being created seeing strong demand. “All of them are competing very well in the world. So far, whatever production is there is already booked. The capacity which is getting created is already booked and the capacity is getting created at a really, really rapid pace,” he said.

Micron scales up tools as semiconductor capacity expands

Vaishnaw pointed to Micron’s semiconductor facility as an example of the pace at which manufacturing capacity is being built in India. “The Micron plant has increased the number of tools 10 times since February,” he said, highlighting the rapid expansion in manufacturing infrastructure at the facility.

The minister also stressed that India’s semiconductor strategy cannot be limited to fabrication and packaging units. A broader ecosystem of equipment makers, materials suppliers, chemical companies and gas manufacturers will be necessary to sustain semiconductor manufacturing over the long term.

He cited Japan as an example of the importance of having a strong domestic ecosystem around chip manufacturing. Japan, Vaishnaw said, was once a global leader in semiconductor manufacturing before that leadership shifted to other countries. However, when Japan decided to rebuild its semiconductor manufacturing capabilities, its existing ecosystem of equipment, materials, chemicals and gas suppliers helped support that revival. “That is a very good example for us to learn. To have a long journey, to have a long growth path, to have a journey where next 20, 30 years we keep growing, we must have the ecosystem in place,” he said.

Vaishnaw said he was particularly encouraged by the interest from capital equipment, materials, gas and chemical manufacturers seeking to expand their presence in India.

The companies, he said, are looking to deepen their supply chains in India and build greater resilience in their global operations. He also pointed to the opportunity for these companies to tap into India’s growing precision-manufacturing ecosystem. “Semiconductors is one of the verticals there. So that capability will be very useful for the equipment manufacturers who would like to get into manufacturing here,” he said.

He added that India’s semiconductor ecosystem was being built with a longer-term view rather than around individual projects. “Semicon 1.0 was all about setting the foundation, making sure that we learned to walk. And Semicon 2.0 is more about getting the ecosystem in place,” Vaishnaw said. The minister said this ecosystem-building approach would determine how effectively India can scale semiconductor manufacturing over the coming decades.