India's semiconductor ambitions are built on proven Asian models rather than attempting to create an entirely new framework. According to a recent report by Equirus Securities, the country has strategically avoided the Chinese approach while incorporating elements from successful Asian economies. The strategy draws from government-backed research and development from Taiwan, foreign direct investment-led manufacturing from Malaysia, domestic champions from South Korea, and capital discipline from Singapore. India currently holds a competitive edge in segments supported by a talent base of nearly three lakh chip designers, representing around one-fifth of the global semiconductor design workforce. As reported by ANI, the country's main challenge is execution, not strategy, requiring the buildout of a skilled workforce, strengthened domestic supply chains, and achievement of globally competitive quality standards within a short period.
The country's semiconductor strategy concentrates on outsourced semiconductor assembly and test (OSAT) and mature process nodes ranging from 28nm to 110nm. These segments account for a significant share of global wafer capacity and are widely used across automotive, industrial and consumer applications. As reported by Equirus Securities, chip consumption is set to more than double to about $155 billion by CY31, supporting the demand-led import substitution approach. The report describes India's semiconductor policy as one of its most credible industrial initiatives, with the country targeting 85,000 industry-ready engineers by CY27. The ambitious target is considered achievable, citing Micron's Sanand ATMP facility, which became operational with around 2,000 trained workers within three years of construction.
Despite strategic strengths, India faces significant import dependency that poses execution challenges. According to the Equirus Securities report, the country is expected to continue importing more than 90% of its semiconductor manufacturing equipment, along with the majority of specialty chemicals and electronic-grade gases required by the industry. While India has a strong pool of chip designers, it faces a shortage of manufacturing-specific talent, including process engineers, metrology specialists, yield engineers and cleanroom technicians. The report cited Micron's Sanand ATMP facility, which became operational with around 2,000 trained workers within three years of construction, as an achievable example. As reported by ANI, the country will import more than 90% of chip-making equipment and 85-90% of specialty chemicals and electronic-grade gases, highlighting this as the biggest weakness in India's semiconductor ambitions.
Several critical gaps remain in India's semiconductor ecosystem that require attention. As reported by Equirus Securities, the country needs stronger incentives for chip design and a more robust equipment and materials ecosystem. The proposed 28nm fabrication facility at Dholera would continue to be considered a mature-node project by global standards even after reaching scale. The report emphasizes that India's dependence on imports for upstream equipment and raw materials remains the biggest weakness in its semiconductor ambitions, with the country expected to maintain high import levels for the foreseeable future. Additional challenges include limited prospects for sub-28nm manufacturing in the near future and the absence of a strong equipment and materials ecosystem.
