Sanand stands as a ‘bridge’ to Silicon Valley: PM on Gujarat town’s rise in semiconductor ecosystem
While inaugurating a semiconductor assembly and test facility of Kaynes Semicon in Sanand, he said there was rapid expansion in the country’s electronics sector and that India’s semiconductor market could exceed $100 billion by the end of the decade
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Context
Prime Minister Narendra Modi inaugurated a semiconductor assembly and testing facility by Kaynes Semicon in Sanand, Gujarat. This event highlights India's strategic push to become a significant player in the global semiconductor ecosystem, aiming to bolster domestic manufacturing, reduce import dependency, and secure its position in critical technology supply chains.
UPSC Perspectives
Economic
The establishment of the Sanand semiconductor plant is a direct outcome of India's targeted industrial policy aimed at fostering a domestic electronics manufacturing ecosystem. This is driven by the India Semiconductor Mission, launched in 2021 with a significant financial outlay to attract investment in semiconductor and display manufacturing. The policy provides substantial fiscal support—up to 50% of the project cost—for setting up semiconductor fabs and other parts of the value chain. The government's ambition is underscored by projections of India's semiconductor market reaching $100 billion by 2030. Initiatives like the Chips to Startup (C2S) Programme aim to create a skilled workforce by training 85,000 professionals, thereby addressing the human capital requirement for this high-tech industry. This strategy of import substitution and export promotion ('Make in India, Make for the World') seeks to reduce vulnerabilities exposed during global supply chain disruptions and capture a larger share of the global electronics market.
Geopolitical & Strategic
India's semiconductor ambitions are deeply intertwined with global geopolitical shifts and the concept of technological sovereignty. The COVID-19 pandemic and ongoing geopolitical conflicts have highlighted the risks of concentrated supply chains, particularly in critical sectors like semiconductors. By positioning itself as a stable, democratic, and reliable manufacturing hub, India aims to de-risk global supply chains. India’s participation in the U.S.-led Pax Silica initiative is a key strategic move. This coalition focuses on building secure supply chains for silicon, AI, and critical minerals among trusted allies, explicitly aiming to reduce dependencies on potential adversaries. Furthermore, the government's focus on securing raw materials through the National Critical Minerals Mission demonstrates a comprehensive approach to building a resilient value chain from mineral extraction to finished chips. The inauguration of the Deesa airbase near the international border, mentioned alongside these developments, subtly links economic strategy with enhanced national and border security, showcasing a holistic view of national power.
Governance & Policy
The government is deploying a multi-pronged policy framework to achieve its semiconductor goals, reflecting a whole-of-government approach. The core is the , an independent business division within the Digital India Corporation, given administrative and financial autonomy to drive long-term strategy. This is complemented by the , launched in 2025 to secure the upstream supply chain by boosting domestic exploration, mining, and recycling of 30 identified critical minerals. A ₹1,500 crore scheme specifically promotes mineral recycling from sources like e-waste. On the human resources front, the under the is a dedicated capacity-building initiative to create a pipeline of skilled design engineers, linking academia with industry. These policies illustrate a strategic intent to build an entire ecosystem, addressing capital, raw materials, and skilled labour, which is crucial for the long-term success and sustainability of a complex industry like semiconductor manufacturing.