India's semiconductor push attracts $12B in new commitments from global chipmakers - Silicon Canals

"India's $10 billion semiconductor incentive scheme, first announced in 2021 and revised in 2023, offers subsidies covering up to 50% of capital expenditure for approved projects. That's an aggressive carrot. But incentives alone don't explain the timing. Three forces are converging. First, geopolitical fragmentation. The US-China chip war has made supply chain diversification an existential priority for companies that once relied heavily on facilities in Taiwan, South Korea, and mainland China."

"India's electronics market is projected to exceed $300 billion by 2026, driven by smartphone penetration, automotive electronics, and a rapidly expanding cloud infrastructure buildout. Companies aren't just manufacturing in India to export - they're positioning to serve the Indian market itself, which is on track to become the world's third-largest consumer of semiconductors by the end of the decade."

India is establishing itself as a global semiconductor manufacturing hub through substantial new investments exceeding $12 billion from companies like Micron and NXP Semiconductors. These commitments span fabrication, assembly, testing, and chip design operations, representing genuine infrastructure development rather than exploratory ventures. India's $10 billion semiconductor incentive scheme, offering up to 50% capital expenditure subsidies, catalyzes this growth. Three converging factors drive investment: geopolitical fragmentation prompting supply chain diversification away from Taiwan, South Korea, and China; India's projected $300 billion electronics market by 2026; and positioning to serve India's emerging status as the world's third-largest semiconductor consumer by decade's end. This transformation addresses India's current near-total semiconductor import dependency.

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