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India's push for semiconductor self-sufficiency
India is accelerating efforts to build a domestic semiconductor industry, aiming to reduce reliance on global supply chains disrupted by the pandemic. While the country excels in chip design, manufacturing has lagged-until now.
The critical role of telecom chips
For Arnob Roy, co-founder of Bangalore-based Tejas Networks, a steady supply of specialized semiconductors is non-negotiable. His company provides the hardware that powers mobile and broadband networks across India.
"Telecom chips differ fundamentally from consumer or smartphone chips. They must handle vast data volumes from hundreds of thousands of users simultaneously-without failure. Reliability and redundancy are built into their architecture."
Arnob Roy, Co-founder, Tejas Networks
Tejas designs many of these chips in India but relies on overseas manufacturers to produce them, a vulnerability exposed during COVID-19 when global chip shortages forced industries to scale back operations.
Pandemic exposes supply chain fragility
"The pandemic revealed how concentrated semiconductor manufacturing is-and how risky that concentration can be," Roy said. Amitesh Kumar Sinha, Joint Secretary of India's Ministry of Electronics and Information Technology, echoed the concern: "If one region shuts down, electronics production worldwide suffers."
India, home to an estimated 20% of the world's semiconductor engineers, hosts design centers for nearly every major global chip company. Yet it lacks domestic fabrication capabilities, forcing firms like Tejas to outsource production.
India targets assembly and testing first
Semiconductor production involves three key stages: design, wafer fabrication, and assembly/testing. India is focusing on the latter, known as Outsourced Semiconductor Assembly and Test (Osat), where silicon wafers are sliced into chips, packaged, and tested.
"Assembly and testing are easier to scale than building fabrication plants," said Ashok Chandak, president of the India Electronics and Semiconductor Association (IESA). Multiple Osat facilities are expected to begin mass production this year.
Kaynes Semicon leads the charge
Kaynes Semicon, founded in 2023, became the first company to launch a government-backed semiconductor plant in Gujarat. The $260 million facility began production in November 2025, assembling and testing chips for automotive, telecom, and defense industries.
"Packaging isn't just putting a chip in a box. It's a 10- to 12-step process. Without it, the wafer is useless."
Raghu Panicker, CEO, Kaynes Semicon
Panicker emphasized that India doesn't need cutting-edge AI chips immediately. "We're starting with chips that serve our domestic market-less glamorous but strategically vital."
Challenges and long-term vision
Building the facility was a learning curve. "We'd never built a semiconductor cleanroom in India before," Panicker said. Training workers proved equally difficult: "You can't compress five years of experience into six months."
Roy remains optimistic. "Over the next decade, we expect a robust semiconductor manufacturing base to emerge in India, directly benefiting companies like ours."
But he cautioned that deep-tech industries require patience. "India is only now supporting long-term investments. Designing and manufacturing complete telecom chipsets will take time."
