SEMICON India 2026: Can India Move from Chips to Innovation?
As India strengthens its semiconductor ecosystem, the focus is increasingly shifting beyond manufacturing capacity toward innovation, intellectual property, chip design, talent, and advanced technologies. The article explores how SEMICON India 2026 reflects this transition, highlighting the role of AI, RISC-V, advanced packaging, precision manufacturing, global partnerships, and homegrown semiconductor capabilities in shaping India’s next phase of growth.
India’s semiconductor market is projected to more than triple from nearly $64 billion in 2026 to $200 billion by 2035, creating opportunities to expand domestic manufacturing, strengthen supply chains and build semiconductor intellectual property, according to the EY–IESA report Semicon India 2.0: From Capacity Creation to Ecosystem Leadership. But India’s semiconductor opportunity is no longer only about establishing fabs; it is about building the IP, products, talent and supporting ecosystem needed to turn manufacturing capacity into sustained innovation.
That ambition was reflected at SEMICON India 2026, held from September 17 to 19 at Yashobhoomi, New Delhi. The event brought together global semiconductor companies, start-ups, research institutions, investors and policymakers under the theme “Silicon to Systems: Building the Ecosystem.”
Inaugurating the event, Prime Minister Narendra Modi said, “Our effort is that fabless companies grow in India, and intellectual property creation also happens in India.”
The focus reflects India’s broader effort to build capabilities across fabrication, assembly, testing, packaging and chip design while developing globally competitive semiconductor technologies and intellectual property.
From Chip Design to a Complete Semiconductor Ecosystem
India has established a strong foundation in semiconductor design, with global technology companies using the country as an engineering and research base for decades. Government programs have expanded access to chip-design tools and encouraged companies and start-ups to develop semiconductor intellectual property.
C-DAC showcased high-performance computing and AI capabilities alongside indigenous processor technologies and application-specific semiconductor solutions.
The development of domestic processor technologies signals a move beyond outsourced engineering. C-DAC’s 64-bit RISC-V processor reflects efforts to build expertise around processor architecture and intellectual property, while private-sector companies such as InCore Semiconductors are developing RISC-V processor IP and system-on-chip capabilities.
Indian start-ups are also exploring application-specific chips for surveillance, energy metering, drones, mobility and industrial applications, demonstrating that a semiconductor ecosystem extends beyond fabrication capacity.
Prime Minister Narendra Modi said, “India must advance simultaneously across chip design, manufacturing, equipment, materials and testing. The government’s India Semiconductor Mission 2.0 focuses on six areas, including design, fabs, ATMP units, research and development, machines and materials, and talent.”
Ashwini Vaishnaw said, “ISM 2.0 could enable at least 200 chip-design companies, supporting the development of homegrown semiconductor IP. The challenge now is to turn this expanding design and manufacturing base into sustained commercial innovation.”
Strengthening India’s Semiconductor Manufacturing Capabilities
Manufacturing remains central to India’s semiconductor ambitions as the country develops capabilities across wafer fabrication, assembly, testing, packaging, equipment and process materials.
According to the Ministry of Electronics and Information Technology, semiconductor projects under the first phase of the India Semiconductor Mission are moving towards commercial production, representing a shift from project approvals and pilot production to manufacturing.
Prime Minister Narendra Modi highlighted this progress at SEMICON India 2026, noting that India’s semiconductor journey had moved from policy discussions in 2022 to projects, pilot lines and test chips. “And this year, we are talking about commercial production,” he said, adding that chips manufactured in India are reaching customers domestically and globally.
Building manufacturing capacity, however, requires much more than wafer fabs. Semiconductor facilities depend on semiconductor-grade chemicals and gases, high-purity materials, specialized equipment, ultra-clean environments, reliable power and water infrastructure, advanced process-control systems and skilled technical personnel.
Advanced packaging and semiconductor assembly and testing are also becoming increasingly important. Technologies such as chiplets, 2.5D and 3D packaging, and heterogeneous integration can improve system performance for AI and high-performance computing by addressing bandwidth, power efficiency and thermal-management requirements.
Precision manufacturing forms another layer of the ecosystem. Indian MSMEs are developing capabilities in high-tolerance component manufacturing, precision engineering, tooling and specialized production for electronics, aerospace, defense, aviation and semiconductor applications.
Ashwini Vaishnaw, Union Minister for Electronics and Information Technology, has announced plans for India’s first Precision Manufacturing Institute and a multi-level training model to develop specialized skills for this ecosystem.
Global semiconductor companies can contribute capital, process expertise, manufacturing know-how and established supply-chain linkages, while India brings engineering talent, domestic demand and growing chip-design capabilities.
The opportunity lies in integrating these strengths across materials, equipment, fabrication, packaging, testing and system integration. Such integration can help India build a resilient manufacturing ecosystem while enabling domestic companies to move further up the value chain.
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The Growing Role of AI in India’s Chip Innovation
Artificial intelligence (AI) is transforming the semiconductor industry while creating demand for specialized chips. AI systems require substantial computing power, memory, networking and accelerators, while AI-enabled capabilities are expanding across edge devices such as cameras, industrial equipment, vehicles, drones and connected infrastructure.
SEMICON India 2026 reflected both sides of this relationship. C-DAC showcased AI and high-performance computing capabilities while Indian companies presented semiconductor solutions for AI-enabled applications. The event also highlighted advanced architectures, chiplets, packaging and system-level design as responses to rising AI workloads.
AI creates demand for different processors depending on the application. Data-centre systems have different requirements from chips powering autonomous vehicles, smart cameras, industrial machines or drones, creating opportunities for application-specific semiconductor design.
AI is also influencing the semiconductor development process. Engineering involves architecture, simulation, verification and optimization, with AI-assisted tools increasingly being explored for RTL generation, verification, floor planning, power analysis, clock-tree synthesis and physical design.
Prime Minister Modi highlighted this shift, saying, “The challenges are not only about what is inside the chip, but also about what is happening around it.”
He pointed to bringing memory closer to processors, connecting multiple chips, moving large volumes of data with low latency, and managing heat and power.
These requirements make AI-driven semiconductor innovation increasingly a system-level challenge. Union Minister Ashwini Vaishnaw has indicated that India’s skilling strategy will increasingly expand from chip design to system design.
For India, this creates opportunities across semiconductor architecture, intellectual property, software, manufacturing, packaging and product development. Connecting these layers could help the country move from participation in semiconductor manufacturing towards technology creation.
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Building Talent for the Next Semiconductor Wave
Talent will be a critical factor in determining how far India progresses along the semiconductor value chain.
India already has a large technology workforce, but semiconductor manufacturing and advanced chip development require specialized expertise across chip architecture, verification, fabrication, packaging, materials, equipment, embedded systems, AI accelerators and testing.
Government programs are attempting to build this talent pipeline. The Chips to Startup program and Design Linked Incentive initiatives have expanded access to semiconductor design tools and specialized training. According to the government, around 70,000 design engineers have been trained over four years, against an initial target of 85,000 over 10 years. Students from around 400 engineering colleges have received access to industry-grade EDA tools, including institutions in smaller cities.
The scale of this effort matters because semiconductor innovation requires practical exposure. Students need professional electronic design automation tools, researchers need opportunities to fabricate and test designs, start-ups need funding and manufacturing partners, and universities need stronger relationships with semiconductor companies.
SEMICON India 2026 brought several of these stakeholders together through its start-up, innovation and workforce-development initiatives, highlighting the connection between education, entrepreneurship and industry.
Modi highlighted India’s engineering talent pool and said the government has set a target of training one lakh engineering students for the semiconductor industry. More than 70,000 young people have already been trained, he said, describing the talent pool as a major resource for the industry.
The next challenge is moving from training numbers to advanced capabilities. A large pool of trained engineers does not automatically translate into semiconductor innovation. Talent programs must create researchers and engineers capable of developing intellectual property, solving complex semiconductor problems and taking technologies from laboratories into commercial products.
This will require hands-on projects, university-industry research, semiconductor laboratories, internships and access to fabrication facilities. It will also require a stronger environment for researchers and entrepreneurs.
Vaishnaw has said the next phase of skilling will move beyond chip design towards system design. He has also highlighted the need for cleanroom technicians and maintenance personnel as manufacturing capacity expands. The government’s multi-level training model for precision manufacturing reflects these broader workforce requirements.
India’s semiconductor ecosystem will not be built exclusively by large corporations. Start-ups, universities and research institutions can develop niche technologies that may eventually become commercial products.
The government says more than 105 chip-design start-ups have received access to advanced EDA tools, while 20 start-ups have secured venture capital funding under the first phase of support. The next step is ensuring that these capabilities translate into products and companies with sustainable commercial models.
Connecting talent, research and commercialization could therefore be critical to India’s next semiconductor phase.
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From Global Investments to Homegrown Semiconductor Innovation
Global investment remains central to India’s semiconductor strategy, and SEMICON India 2026 demonstrated continued international interest in the country’s ambitions. The event brought together global companies, Indian businesses, start-ups, researchers and policymakers across design, manufacturing, packaging, equipment, materials, research and talent. India-Singapore, India-Europe and India-South Korea discussions also explored technology partnerships and investment opportunities.
Investment, however, is only one measure of ecosystem development. India needs domestic companies that own semiconductor intellectual property, develop differentiated products and compete globally.
Vaishnaw has highlighted the shift from design services towards a “Product Nation,” with Indian-designed chips moving into end products.
Modi has similarly emphasized the growth of fabless companies and domestic IP creation.
This does not require India to build every part of the semiconductor value chain domestically. The industry is inherently global, with countries specializing in design, fabrication, equipment, materials, packaging and research. India can strengthen its domestic capabilities while continuing to work with international companies for capital, technology and market access.
From Manufacturing Capacity to Sustained Innovation
India’s next challenge is connecting its manufacturing base and engineering talent with research, advanced packaging, product development and intellectual property. AI could accelerate this transition by creating demand for specialized processors, while RISC-V, precision manufacturing and advanced packaging offer further opportunities for Indian expertise.
Progress will therefore need to be measured beyond fabs and investment announcements. It will include the companies created in India, the IP they develop, products they commercialize and technologies they export.
SEMICON India 2026 showed that the country’s semiconductor ambitions now extend beyond making chips to building capabilities across design, manufacturing, packaging, AI, high-performance computing, materials, equipment, research and talent. The transition will take time and require continued global partnerships, capital and expertise.
The next test is whether these capabilities translate into a sustained pipeline of Indian semiconductor products and companies by connecting engineering talent with research, infrastructure, venture capital, global partnerships and markets.