SEMICON India 2026: A Wider View of India’s Semiconductor Ecosystem

SEMICON India 2026 was designed around a value-chain approach rather than focusing only on semiconductor fabrication.

The exhibition brought together technologies and organisations involved in:

• Semiconductor design

• Wafer fabrication

• Assembly, testing and packaging

• Advanced packaging

• Semiconductor materials

• Manufacturing equipment

• Artificial intelligence

• High-performance computing

• Electronic systems

• Research and development

• Start-ups

• Workforce development

• Supply-chain management

• Sustainability

The event included six country pavilions and 12 state pavilions, alongside a Start-up Pavilion, Workforce Development Zone, Innovation Showcase and Student Hackathon. Over the three days, 56 MoUs, announcements and strategic initiatives were recorded across areas such as design, fabrication, packaging, equipment, materials, AI, high-performance computing, R&D, logistics and workforce development.

This broader representation is important because a competitive semiconductor industry cannot be created by building a single fab. It requires designers, foundries, packaging companies, equipment suppliers, chemical and material manufacturers, testing facilities, logistics networks, research institutions and skilled engineers to operate together.

India’s Semiconductor Market Is Entering a High-Growth Phase

The economic opportunity behind India's semiconductor push is substantial.

According to a recent McKinsey analysis, the global semiconductor market crossed $1 trillion in 2026 and could reach approximately $2.3 trillion by 2030 in its current base-case scenario. The research attributes much of the acceleration to AI infrastructure, data centres, leading-edge processors and memory.

Another 2026 Deloitte industry outlook estimated global semiconductor sales at approximately $975 billion in 2026, illustrating how quickly forecasts have been revised upward as AI-related demand has accelerated.

India is also expected to experience strong growth in semiconductor demand. Government estimates put the country's semiconductor market at roughly $45–50 billion in 2024–25, with projections of around $100–110 billion by 2030.

This demand will come from several sectors, including:

• Smartphones and consumer electronics

• Automobiles and electric vehicles

• Telecommunications

• Data centres

• Artificial intelligence

• Industrial automation

• Defence and aerospace

• Renewable-energy systems

• Smart electricity meters

• Internet of Things devices

The growing domestic market creates an opportunity for Indian companies to design chips not only for the domestic market but also for international customers.

From Chip Design to High-Performance Computing

One of the most important developments visible at SEMICON India 2026 was the movement from individual chip designs towards complete computing systems.

The Centre for Development of Advanced Computing (C-DAC) showcased indigenous high-performance computing and AI capabilities, including the AUM HPC-AI Processor and the RUDRA-AUM compute node.

This represents an important distinction. Semiconductor capability is not simply about manufacturing silicon. The real value of a processor becomes visible when it is integrated into servers, computing platforms, AI systems and other applications.

India has traditionally possessed significant strengths in semiconductor design and software engineering. The emerging challenge is to connect these capabilities with domestic processor architecture, fabrication, packaging and system development.

The growth of high-performance computing is particularly relevant because AI workloads require enormous amounts of processing power, memory bandwidth and energy-efficient computing.

McKinsey's latest research estimates that server and data-centre semiconductor revenue could rise from around $330 billion in 2025 to $1.2 trillion by 2030, driven largely by AI infrastructure.

This creates opportunities for Indian companies working on CPUs, AI accelerators, networking chips, memory technologies, power management and specialised processors.

RISC-V and the Development of Indigenous Processor Technology

Open processor architectures such as RISC-V are also becoming increasingly important in India's semiconductor strategy.

RISC-V provides an open instruction-set architecture that companies and research organisations can use to develop customised processor designs. This can reduce dependence on proprietary processor architectures for certain applications and provide greater flexibility for developing application-specific systems.

C-DAC's work on indigenous 64-bit RISC-V processors represents one part of this effort.

The importance of RISC-V extends beyond the processor itself. Domestic processor IP can form the foundation for chips designed for:

• Embedded systems

• Industrial equipment

• Automotive applications

• Telecommunications

• Edge AI

• Smart devices

• Security systems

• High-performance computing

InCore Semiconductors is another example of India's RISC-V design ecosystem. The company works on RISC-V processor IP and system-on-chip design automation, demonstrating how Indian start-ups are attempting to develop reusable semiconductor intellectual property rather than focusing only on one-off chip designs.

A strong domestic IP ecosystem can eventually allow Indian companies to retain more value from chip design and create products around locally developed architectures.

Vihaan-I and India’s Push for Indigenous Broadband Technology

The development of indigenous networking technology provides another example of the transition from chip design to complete systems.

Aheesa Digital Innovations showcased Vihaan-I, an indigenously designed broadband networking chip based on the RISC-V architecture and incorporating C-DAC's processor technology.

The chip achieved first-pass silicon success in August 2026 after being taped out earlier in the year. The company is working towards commercialisation with partners in the networking ecosystem.

The importance of such technology lies in its potential applications across broadband connectivity and telecommunications.

India's digital infrastructure increasingly depends on high-speed networking equipment. Domestic networking chips could therefore become important components in building a more diversified electronics and telecommunications supply chain.

The broader lesson is that semiconductor self-reliance does not necessarily mean producing every component domestically from day one. It can also involve building domestic IP, system architecture, software platforms and product integration capabilities while gradually localising manufacturing and supply-chain inputs.

Application-Specific Chips for Everyday Products

The semiconductor industry is not only about advanced processors used in AI data centres.

A large part of the opportunity lies in application-specific integrated circuits and controllers used in everyday products.

Vervesemi Microelectronics provides an example of this segment. The company is developing chips for motor control, energy metering, data acquisition and other applications.

According to the Ministry of Electronics and Information Technology, Vervesemi has developed designs targeting applications such as BLDC fans, electric vehicles, drones, industrial automation, energy meters and avionics. Its portfolio includes designs using 55 nm, 110 nm and 180 nm technologies, illustrating that semiconductor value is not limited to the most advanced process nodes.

This distinction is important.

While advanced 3 nm and 2 nm processors attract considerable attention, mature and specialised semiconductor nodes remain critical for:

• Automotive electronics

• Industrial controllers

• Power management

• Sensors

• Energy meters

• Appliances

• Medical equipment

• Telecommunications equipment

India therefore needs capabilities across multiple technology generations rather than concentrating exclusively on leading-edge fabrication.

AI Chips and Edge Computing Gain Importance

Artificial intelligence was another major theme running through the semiconductor ecosystem showcased at SEMICON India 2026.

AI is changing semiconductor demand at two levels.

The first is data-centre AI, which requires powerful processors, accelerators, high-bandwidth memory and advanced networking.

The second is edge AI, where intelligence is processed closer to cameras, vehicles, industrial machines, robots and consumer devices.

The second category can create opportunities for Indian chip start-ups because edge applications often require specialised combinations of computing performance, power efficiency, security and connectivity.

Kerala-based Netrasemi, for example, developed the A2000, a 12 nm edge-AI system-on-chip designed for applications including surveillance, robotics, intelligent video systems and industrial automation. The company has completed silicon bring-up and begun customer evaluation.

Such chips demonstrate how AI is expanding semiconductor opportunities beyond large data centres.

An AI-enabled camera, drone or industrial machine may need local processing to reduce latency, improve privacy and decrease dependence on cloud connectivity. This makes edge-AI chips increasingly relevant to smart infrastructure and industrial applications.

Advanced Packaging Is Becoming as Important as Chip Manufacturing

Another important lesson from SEMICON India 2026 is that semiconductor manufacturing does not end when a wafer is fabricated.

The finished semiconductor must be:

1. Cut into individual dies.

2. Packaged.

3. Connected to other components where necessary.

4. Tested.

5. Qualified for its intended application.

6. Integrated into an electronic system.

Advanced packaging has become particularly important because modern computing increasingly involves multiple dies, chiplets, high-bandwidth memory and specialised processors.

AI has accelerated this trend because performance improvements increasingly depend not only on transistor scaling but also on how processors, memory and interconnects are integrated.

India's growing focus on OSAT and ATMP facilities therefore provides an entry point into an important part of the global semiconductor value chain.

India Moves From Semiconductor Plans to Commercial Production

One of the clearest changes visible in 2026 is the movement from announcements towards actual commercial operations.

Under the first phase of the Semicon India Programme, 12 semiconductor projects were approved across six states.

At the beginning of SEMICON India 2026, commercial production was launched at two additional facilities:

• CDIL Semiconductor's ATMP facility in Mohali, Punjab

• Suchi Semicon's OSAT facility in Palsana, Gujarat

This brought the number of operational commercial semiconductor units among the approved Semicon 1.0 projects to five. The other operational facilities include Micron, Kaynes Semicon and CG Semi in Gujarat.

This distinction matters because policy announcements and investment commitments are different from production.

A functioning semiconductor facility has to demonstrate:

• Manufacturing reliability

• Yield

• Quality control

• Equipment uptime

• Supply-chain stability

• Customer qualification

• Testing capability

• Workforce readiness

• Environmental compliance

The emergence of commercial operations therefore represents a more concrete stage of ecosystem development.

Micron, Tata Electronics and the Growing Manufacturing Base

India's semiconductor manufacturing ecosystem is also attracting large international and domestic investments.

Micron has begun commercial DRAM and NAND production activities at its Sanand facility in Gujarat, according to statements made during SEMICON India 2026.

Tata Electronics is developing a 300 mm semiconductor fab at Dholera, Gujarat, alongside an OSAT facility in Assam. At SEMICON India 2026, Tata Electronics announced partnerships and initiatives involving wafer manufacturing, assembly and testing, advanced packaging, photoresists, chemicals, materials and talent development.

These developments highlight another important principle of semiconductor manufacturing: a fab cannot operate in isolation.

It requires reliable suppliers of:

• Electronic chemicals

• Gases

• Photoresists

• Silicon wafers

• Manufacturing equipment

• Packaging materials

• Testing systems

• Water-treatment systems

• Clean-room infrastructure

• Logistics services

Developing these supporting industries will determine how deeply India can participate in the semiconductor value chain.

Semicon 2.0: The Next Phase of India’s Semiconductor Strategy

The transition from Semicon 1.0 to Semicon 2.0 was one of the most important policy developments surrounding SEMICON India 2026.

The Union Cabinet approved Semicon 2.0 in July 2026 with a total outlay of ₹1,27,500 crore. The programme is designed to strengthen the semiconductor ecosystem through six broad pillars:

1. Semiconductor Design

The objective is to deepen India's chip-design capabilities and encourage domestic semiconductor intellectual property.

2. Machines and Materials

Developing domestic capabilities in equipment, chemicals, materials and other inputs can reduce supply-chain vulnerabilities.

3. New Fabs

The programme seeks to expand wafer fabrication capacity and strengthen India's manufacturing base.

4. Advanced Packaging

Packaging is increasingly becoming a major source of semiconductor innovation, especially for AI, chiplets and high-performance systems.

5. Research and Development

Long-term semiconductor competitiveness requires sustained research in devices, materials, architectures, manufacturing processes and system integration.

6. Talent Development

A semiconductor ecosystem needs engineers, technicians, researchers, equipment specialists, process engineers and manufacturing professionals.

The government's approval of Semicon 2.0 therefore reflects a shift from individual projects towards ecosystem-level development.

Building a Large Semiconductor Talent Pipeline

Talent is one of the most important foundations of the semiconductor industry.

India already has a large pool of engineers, but semiconductor manufacturing requires highly specialised skills in areas such as:

• VLSI design

• Verification

• Semiconductor process engineering

• Lithography

• Packaging

• Device physics

• Chemical engineering

• Materials science

• Equipment maintenance

• Yield engineering

• Reliability testing

• AI hardware design

The Chips to Startup (C2S) Programme and the Design Linked Incentive ecosystem have been created to expand access to semiconductor design tools and training.

Government information indicates that more than one lakh engineers from over 500 organisations, including academic institutions and start-ups, have been onboarded through the ChipIN Centre and associated programmes. More than 300 chip designs have been developed for fabrication in India and overseas, while participants have accumulated more than four crore hours of chip-design tool usage.

Such programmes can help bridge the gap between university-level electronics education and industry requirements.

The next challenge is to ensure that training moves beyond tool access towards production-grade experience, internships, fabrication exposure and system-level product development.

Why Supply-Chain Resilience Matters

The global semiconductor shortage demonstrated how disruptions in one part of the world can affect industries thousands of kilometres away.

Semiconductor manufacturing involves an extremely interconnected international network. A single product may involve chip architecture from one country, fabrication in another, equipment from several countries, specialised chemicals from different suppliers, packaging elsewhere and final assembly at another location.

Recent geopolitical tensions have increased the emphasis on supply-chain diversification.

The global semiconductor market grew at an average annual rate of about 6.5% between 2014 and 2024, according to a recent Indian government background note, while demand is expected to grow faster in the coming years. The same source notes that India has imported almost $150 billion worth of semiconductor products during FY2017–FY2025, highlighting the scale of domestic demand and the opportunity for local manufacturing.

India's objective is therefore not simply to replace imports. A stronger ecosystem could help Indian companies become suppliers to international electronics and semiconductor value chains.

Sustainability Must Be Built Into Semiconductor Manufacturing

Semiconductor manufacturing is technologically advanced but resource intensive.

Fabs require ultra-pure water, electricity, specialised chemicals, gases and highly controlled environments. As India develops new semiconductor facilities, sustainability will therefore need to be considered during facility design rather than treated as an afterthought.

Industry organisation SEMI has developed guidance covering water reuse, resource conservation and sustainable manufacturing. Its current F98 standard provides recommendations for designing industrial water-treatment systems that enable water reuse in semiconductor facilities.

SEMI's 2026 smart-manufacturing sustainability roadmap also highlights the use of connectivity, sensors, predictive analytics, machine learning and AI to improve energy, water and waste performance in semiconductor fabs.

These practices can be particularly relevant to India because new facilities provide an opportunity to integrate sustainability into the original design.

Important industry practices include:

• Recycling and reusing process water

• Segregating wastewater streams

• Monitoring water consumption digitally

• Using predictive maintenance

• Improving equipment energy efficiency

• Increasing renewable-energy use

• Recovering useful materials from waste

• Applying AI to optimise factory operations

SEMI's 2026 work on circularity also recommends greater recovery and recycling of spent chemicals, wastewater by-products, packaging and manufacturing waste.

AI Can Improve Semiconductor Manufacturing Efficiency

Artificial intelligence is not only increasing demand for chips; it can also change how chips are manufactured.

Modern fabs generate enormous volumes of process data. AI and machine-learning systems can analyse this information to identify anomalies, predict equipment failures, optimise manufacturing parameters and improve yield.

A recent McKinsey analysis estimates that AI-enabled improvements across semiconductor-fab operations could potentially generate nearly $134 billion in functional cost savings over five to seven years if such technologies are fully scaled.

This creates a potentially important opportunity for India.

New semiconductor facilities can be designed around:

• Digital twins

• Automated material handling

• Predictive maintenance

• Real-time quality monitoring

• AI-assisted yield analysis

• Automated process control

• Energy optimisation

The combination of semiconductor manufacturing and AI could therefore create a feedback loop in which India develops both the chips required for AI and AI technologies used to improve chip manufacturing.

Start-ups Are Expanding the Semiconductor Innovation Base

India's semiconductor ambitions also depend on the ability of start-ups to convert research into commercial products.

Government-backed programmes such as DLI reduce some of the financial barriers involved in chip design, prototyping and validation.

The ecosystem now includes companies working on:

• RISC-V processors

• AI accelerators

• Motor-control ICs

• Smart-meter chips

• Surveillance chips

• Broadband processors

• Automotive semiconductors

• Power electronics

• Data-conversion technologies

• Industrial chips

The presence of these companies is important because a mature semiconductor ecosystem cannot depend entirely on a few large manufacturers.

Start-ups can explore specialised markets that may not justify investment by larger semiconductor companies. Successful products can subsequently become part of larger electronics and industrial supply chains.

SEMICON India 2026 and the Importance of Global Partnerships

India cannot build a globally competitive semiconductor industry entirely in isolation.

Semiconductor manufacturing is one of the most globally integrated industries, and India will need partnerships involving:

• Equipment manufacturers

• Foundries

• International semiconductor companies

• Materials suppliers

• Research institutions

• Universities

• Technology providers

• Global electronics manufacturers

SEMICON India 2026 reflected this international dimension, with participants from 52 countries, six country pavilions and around 300 international exhibitors.

One major announcement during the event came from Applied Materials, which announced plans to invest $5 billion in India over the next decade, focusing on areas including research, supply-chain development and workforce expansion.

Such investments can bring more than capital. They can also contribute to technology transfer, supplier development, workforce training and integration with international manufacturing networks.

What India Still Needs to Build

Despite significant progress, India's semiconductor ecosystem remains in a development phase.

The country still needs to strengthen several areas:

Large-Scale Wafer Fabrication

Packaging and testing capacity is expanding, but large-scale advanced wafer fabrication remains significantly more complex and capital intensive.

Domestic Equipment and Materials

Greater domestic capability in semiconductor equipment, chemicals and materials can improve supply-chain resilience.

High-Yield Manufacturing

Building a fab is only one part of the challenge. Consistently producing high-quality chips at competitive yields is essential for commercial success.

Advanced Packaging

India needs to develop capabilities in chiplets, heterogeneous integration, high-bandwidth memory packaging and other advanced technologies.

Research

Long-term competitiveness will depend on sustained investment in semiconductor physics, materials, process technologies, architecture and manufacturing science.

Skilled Workforce

The sector will need a much larger pipeline of specialised technicians, engineers and researchers as facilities scale.

Global Customer Qualification

Indian semiconductor products must meet stringent reliability, quality and performance requirements before they can become part of major international supply chains.

From Silicon to Systems: What SEMICON India 2026 Demonstrated

The central message of SEMICON India 2026 was that India's semiconductor ambition is expanding beyond the idea of simply manufacturing chips.

The semiconductor ecosystem now being developed includes the entire journey:

Materials → Equipment → Chip Design → Fabrication → Packaging → Testing → Electronics → AI → Computing Systems → Global Markets

This is why the event's theme, “Silicon to Systems: Building the Ecosystem,” is significant.

A processor has little value without packaging. A fab cannot function without equipment and materials. A chip cannot become a commercial product without testing and system integration. A semiconductor company cannot scale without skilled engineers and customers.

The industry's future therefore depends on how effectively these individual components connect.

Conclusion: India’s Semiconductor Journey Is Moving Into Its Next Phase

SEMICON India 2026 offered a snapshot of an Indian semiconductor ecosystem that is becoming broader and more commercially oriented.

The country has moved beyond a purely policy-driven semiconductor discussion. Five semiconductor units under the first phase of the national programme have now entered commercial production, while additional fabs, packaging facilities and supporting infrastructure are being developed.

At the same time, Indian start-ups are developing RISC-V processors, AI SoCs, motor-control chips, broadband processors and other application-specific technologies. Government programmes are expanding access to chip-design tools, while Semicon 2.0 is providing a larger policy framework for design, equipment, materials, fabs, advanced packaging, research and talent.

The global market environment is also changing rapidly. AI is creating unprecedented demand for processors, memory, networking and advanced packaging. McKinsey's latest analysis projects a potential $2.3 trillion global semiconductor market by 2030, although actual growth will depend on AI investment, capacity expansion, economic conditions and technology developments.

For India, the opportunity extends beyond meeting domestic demand.

The larger objective is to become an integrated participant in global semiconductor supply chains while developing domestic intellectual property, manufacturing capabilities, specialised suppliers and system-level technologies.

The next phase will therefore be measured not simply by the number of investment announcements or semiconductor projects approved, but by production yields, commercial products, global customers, domestic supplier networks, research outcomes, skilled jobs and the ability to build competitive technologies at scale.

SEMICON India 2026 showed that this ecosystem is beginning to take shape. The long-term test will be whether India can connect silicon, systems, talent, research, manufacturing and global partnerships into a sustainable and internationally competitive semiconductor industry.