My first look inside electronics was a Siemens valve radio in the early 1970s, before transistor sets took over the living room. The family sat in front of that cabinet the way people sit in front of a television now, waiting for the nine o'clock news. A childhood friend, Vivek Chickermane, later went into the work that replaced those valves. He designs the test software that tells a finished chip whether it is good enough to ship. He is now with Siemens EDA after IBM and Cadence.
I watched Prime Minister Modi open the fifth SEMICON India at Yashobhoomi on 17 September. He walked the room through four years of the same conference. Policy first. Then files and foundation stones. Then pilot lines and test chips. This year, he said, chips are leaving Indian plants and reaching customers. Twelve projects are approved. He put the second phase of the mission at $13.5 billion after an $8 billion first phase. The world, he said, needs trusted places to make semiconductors, and India has been preparing (Press Information Bureau, 17 Sep. 2026; Barik, The Indian Express, 17 Sep. 2026).
Sridhar Vembu published an essay in The Financial Express, which the Prime Minister later shared, he said India already has a large base of chip designers and that manufacturing was the missing layer. Tata Electronics' foundry at Dholera, planned with Taiwan's Powerchip Semiconductor Manufacturing Corporation, will fill part of that gap: 50,000 wafers a month on mature nodes used in cars, industrial systems, power devices, and microcontrollers. The more important output, Vembu wrote, will be the capabilities and know-how a working fab creates: ultrapure gases and chemicals, precision tools, packaging and testing, reliable power and water, process engineers, and disciplined suppliers. Previously Vembu has listed how deep the dependence goes. You use a browser and a chat app. Those sit on an operating system. That sits on chips. Chips are made in plants. Those plants need special machines. If India only buys each of those instead of learning to make them, someone else can shut the supply off. Zoho is a software company. In 2024 it applied to build a plant for power chips (the ones in electric cars and trains), and it wanted government help because those plants are expensive. In May 2025 Vembu said they were stopping. They did not trust the manufacturing method enough to take taxpayer money.(Vembu, The Financial Express, 16 Sep. 2026; Vembu, 21 Mar. 2025; Vembu, 1 May 2025).
What’s Manufacturing Today vs. What’s Still on the Drawing Board
Sanand finishes chips that were printed somewhere else. A foundry prints the circuits on a blank silicon wafer. Tata is building that foundry at Dholera with Powerchip of Taiwan.
Dholera is the foundry test. Cabinet and company materials use ₹91,000 crore. A fiscal support agreement cited by project trackers uses ₹91,526 crore. Planned processes sit between 28 and 110 nanometers. First or trial wafers are still a late-2026 target. Industry reporting puts commercial-scale output around 2028, and some accounts say the ramp may start at 90 nanometers before 28. Tata has been lining up suppliers: ASML for lithography, Japanese resist and chemical houses, industrial-gas firms, European assembly equipment. A first wafer and a qualified customer order are different events. Exact yields at the three live Sanand plants have not been independently published.
The next wave is broader than Sanand. Tata is building a large packaging plant in Morigaon, Assam. HCL and Foxconn are building display-driver packaging near Jewar in Uttar Pradesh. SiCSem is starting a silicon-carbide line in Bhubaneswar. CDIL in Mohali makes discrete power devices. Suchi Semicon in Surat and L&T Semiconductor Technologies, which this week agreed to work with Tata on India-designed parts, sit on the design-to-package path. Mindgrove, C2i, NetraSemi, Morphing Machines, Agnit, and Cyient are the design names I would keep on a watch list. About 125,000 engineers already do chip design in India, roughly a fifth of the global design workforce.
Who Holds the Rest of the Stack
NVIDIA designs most of the AI accelerators and booked about $216 billion of fiscal 2026 revenue. Taiwan Semiconductor Manufacturing Company still makes the leading-edge wafers those designs need, with about 72 percent of pure-play foundry revenue in recent quarters. Samsung and SK Hynix in South Korea lead memory, including the high-bandwidth stacks that sit next to those accelerators. Micron is the United States memory house that is now packaging in Gujarat. ASML in the Netherlands is the only company that sells extreme-ultraviolet lithography machines. Applied Materials and Lam Research sell the etch and deposition tools. Shin-Etsu and SUMCO in Japan, with GlobalWafers and Siltronic, cut most of the polished silicon wafers.
Governments are paying to move pieces of that map. The United States is using the CHIPS Act and a 25 percent investment tax credit. Japan is funding Rapidus and hosting TSMC and Micron plants. South Korea is defending memory with tax credits and the Yongin cluster. The European Union has a Chips Act and a 2026 revision. China is pushing SMIC and restricting exports of materials it refines. Malaysia, Singapore, and Vietnam still do a large share of assembly. India's bet is mature-node wafers, packaging, design, and the supplier park around those plants, not a leap to the nodes NVIDIA buys from TSMC.
What Has to Arrive at the Dock
Silicon starts as quartz. China smelts most ordinary silicon. Semiconductor-grade polysilicon and polished wafers are a narrower business still concentrated in Japan, Germany, Taiwan, and the United States. Photoresists come heavily from Japanese chemical firms. Neon for older lithography lasers was a Ukraine and Russia problem after 2022. Gallium, pulled from aluminum production, and germanium, pulled from zinc and coal, are refined mostly in China and go into radio and power devices. Rare earth magnets sit inside the tools themselves. Copper for wiring is widely mined. Ultra-pure water and millisecond-stable power have to be local, or the plant does not hold a process.
Semicon 2.0 is the policy answer to that list. Cabinet approved ₹1,27,500 crore on 15 July 2026 across design and intellectual property, machines and materials, fabs, advanced packaging, applied research, and talent. Commitments reported around the conference are not money already spent. Vembu's May 2025 decision is the private-sector version of the same test: do not draw public capital until the process path is one you would defend.
If you buy electronics, autos, or industrial gear in India, ask which packaged devices now ship from Sanand and which still wait on imported wafers. Ask when Dholera has a qualified customer, not a target date. Ask who supplies the gases, resists, and spare tools, and what happens if that shipment stops. Design talent is already here. The next proof is wafers that come back good, week after week.
Sources
Barik, Soumyarendra. "World Needs New, Trusted Chip Bases, India Ready for It: PM Modi." The Indian Express, 17 Sep. 2026, indianexpress.com.
Press Information Bureau. "English Rendering of PM's Speech during the Inauguration of SEMICON India 2026." 17 Sep. 2026, pib.gov.in.
Vembu, Sridhar. "A Nation Learns by Building." The Financial Express, 16 Sep. 2026, financialexpress.com.
"Zoho's Sridhar Vembu Suspends Chipmaking Plans Saying It Is Too Capital-Intensive." The Hindu Business Line, 1 May 2025, thehindubusinessline.com.
Kumar, Ashmit. "PM Modi Pitches India as Trusted Semiconductor Hub at Semicon India 2026." CNBC-TV18, 17 Sep. 2026, cnbctv18.com.
