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India’s Semiconductor Journey: Old Designer, New Producer

India already has the design talent; what it needs is to turn this talent into Indian-owned companies, and to build the supplier base its fabs lack.

The fifth edition of SEMICON India closed on September 19 in New Delhi, after featuring a massive scale of over 600 exhibitors and 300 international companies across 52 countries. Themed “Silicon to Systems: Building the Ecosystem,” the exhibition-cum-conference served two objectives. For industry, it showcased expansion in India’s indigenous technology, ranging from high-performance computing and domestic processor design to system-on-chip design automation tools. On the policy front, the platform highlighted the evolution of India’s semiconductor ecosystem, stressing its expanding capabilities and role in the global semiconductor landscape.

Semicon 2.0, the second phase of the India Semiconductor Mission (ISM), was approved in July 2026 with an announced outlay of around $13 billion. The mission pitches India as a trusted and reliable partner in the global semiconductor value chain. India’s Electronics and IT Minister Ashwini Vaishnaw described the new phase as moving “from demonstrating intent to executing projects at scale.” With increasing participation from global stakeholders, India is turning its ambitions into a credible reality.

India, an old designer in the semiconductor ecosystem, is becoming a new producer. ISM 2.0’s  progress is to be measured by two key strengths: the intellectual property created by India’s talent, and the inputs its factories consume. 

India’s semiconductor journey is not a rags-to-riches developing country story. India was a capable and serious player in the industry early on. Back in the 1980s, it had a considerable semiconductor push, with only a thin gap between India and the latest semiconductor manufacturing technologies available globally. Unfortunately, India’s chip industry lost its momentum after a devastating 1989 fire at the state-run Semiconductor Complex Limited in Mohali. Then, after the 1991 economic liberalization, the zeal for at-home manufacturing diminished. Chips could be imported from abroad for less money, while Indian fabs faced thin subsidies, bureaucratic bottlenecks, and inadequate infrastructure.

Although manufacturing became a lost cause, what India tremendously excelled in was chip design. Design is the most intellectually demanding and value-dense task of the supply chain, and India hosts around 20 percent of the world’s chip design talent working out of its Global Capability Centers (GCCs). The Indian tech cities of Bengaluru, Hyderabad, Noida, and Pune harbor massive engineering talent providing R&D for firms like Intel, Qualcomm, Texas Instruments, and NXP. This part of the supply chain existed and thrived in India even  before the ISM policy and rebranding. 

No matter how impressive it sounds, domestic capabilities in designing chips for multinational companies and filing patents for foreign parent firms is one thing. Success in domestic manufacturing and design ownership is another. 

ISM 2.0 targets the ownership gap by funding full-stack Indian semiconductor IP,........

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