Chips to clean energy, India and the Netherlands upgrade ties

An Indian Prime Minister visited the Netherlands in May 2026, where bilateral ties were formally elevated to a Strategic Partnership, backed by 17 agreements...

What Happened

An Indian Prime Minister visited the Netherlands in May 2026, where bilateral ties were formally elevated to a Strategic Partnership, backed by 17 agreements and memoranda of understanding covering defence, semiconductors, critical minerals, health, agriculture, water management, renewable energy, maritime development, migration and mobility, and science and innovation.
The landmark deal of the visit: Tata Electronics and ASML signed an MoU to support India's first commercial 300-millimetre semiconductor fabrication plant in Dholera, Gujarat — backed by a total investment of USD 11 billion (approximately INR 91,000 crore).
Both countries agreed on a Strategic Partnership Roadmap 2026–2030 and a Green Hydrogen Development Roadmap, committing to joint work on clean energy transition.
A Defence Industrial Cooperation Roadmap was agreed upon, enabling joint manufacturing through technology transfer in maritime systems and space.
A Migration and Mobility Pact was signed to facilitate movement of Indian students, skilled workers, and professionals to the Netherlands.
The bilateral discussions contextualised the recently concluded India-EU Free Trade Agreement (January 2026), which both sides described as a transformative economic framework.

Static Topic Bridges

India Semiconductor Mission (ISM) and the Dholera Fab

The India Semiconductor Mission (ISM) was launched in December 2021 under the Ministry of Electronics and Information Technology (MeitY) with an initial outlay of ₹76,000 crore, providing a 50% capital subsidy for approved fabrication, ATMP (Assembly, Testing, Marking and Packaging), and compound semiconductor projects. The Dholera fab represents the most significant project under ISM to date.

The Dholera plant will be India's first commercial 300 mm wafer fab — a critical benchmark as most advanced chips (used in AI, mobile, automotive) are made on 300 mm wafers.
Process technology licensed from Taiwan's Powerchip Semiconductor Manufacturing Corporation (PSMC), covering 28 nm, 40 nm, 55 nm, 90 nm, and 110 nm nodes.
At full capacity: 50,000 wafers per month for power management ICs, display drivers, microcontrollers, and high-performance computing logic.
The Government of India is funding 50% of investment (approximately USD 5.5 billion / ₹45,000 crore) under ISM.
ISM has approved 12 semiconductor projects across six states as of May 2026, with total investment of approximately ₹1.64 lakh crore.
Dholera Special Investment Region (DSIR) is one of India's first greenfield smart cities under the Delhi-Mumbai Industrial Corridor (DMIC) project.

Connection to this news: The Tata-ASML MoU is the critical equipment supply agreement for the Dholera fab — without ASML's lithography machines, the plant cannot operationalise. This makes the Netherlands indispensable to India's semiconductor ambitions.

ASML: The Choke Point of Global Chip Manufacturing

ASML Holding, headquartered in Veldhoven, Netherlands, is the sole manufacturer of Extreme Ultraviolet (EUV) lithography machines — the equipment needed to print circuit patterns on the most advanced semiconductor chips. EUV machines use extremely short wavelengths of light (~13.5 nm) generated by vaporising molten tin droplets to etch transistors below 4 nanometres in size. No other company in the world has successfully commercialised this technology.

ASML was founded in 1984 as a joint venture of Philips and ASM International; it became independent in 1995.
ASML's EUV monopoly gives the Netherlands (and by extension, the EU and US) extraordinary leverage in global semiconductor supply chains.
The US has pressured the Netherlands to restrict ASML's exports to China since 2022; as of 2024, ASML is prohibited from exporting advanced EUV systems to China — making India's ASML partnership geopolitically significant.
One EUV machine costs approximately USD 350 million; High-NA EUV (next generation) costs around USD 400 million.
ASML machines have approximately 800 global suppliers and contain hundreds of thousands of parts.

Connection to this news: India entering an ASML partnership signals not merely commercial intent but geopolitical alignment — positioning India in the US-led semiconductor supply chain coalition that excludes China from the most advanced equipment.

Netherlands as India's Largest FDI Source in Europe

The Netherlands is India's fourth-largest overall source of FDI (after Mauritius, Singapore, and USA) and the largest from Europe, with cumulative FDI equity inflows of USD 55.6 billion (April 2000–December 2025), accounting for approximately 7% of total FDI equity into India. This is partly structural: many European multinationals route investments through Dutch holding companies due to the Netherlands' treaty network and tax regime.

Total bilateral merchandise trade (2024-25): USD 27.8 billion, making the Netherlands India's 6th largest trade partner globally.
The Netherlands is India's largest export destination in Europe.
Dutch areas of investment in India: agriculture, logistics, water management, electronics, and renewable energy.
Water, Agriculture, and Health (WAH) are the three priority cooperation sectors under the bilateral Joint Working Group framework.
India and the Netherlands formalised the Joint Trade & Investment Committee (JTIC) in December 2025.
25 Centres of Excellence (CoEs) in agriculture are being jointly established; 7 are already functional (Netherlands specialises in greenhouse technology, precision farming, and post-harvest management).

Connection to this news: The elevation to Strategic Partnership, combined with the Roadmap 2026-2030, places the relationship on an institutionalised footing that can sustain the long-term commitments required for the semiconductor and clean energy transitions.

India-EU Free Trade Agreement (2026)

India and the EU concluded negotiations for a Free Trade Agreement in January 2026 — described as the largest FTA either side has ever concluded, covering approximately 2 billion people and ~25% of global GDP. The agreement covers goods, services, digital trade, intellectual property, sustainable development, and government procurement across 20 chapters.

Tariff elimination or substantial reduction on approximately 96–97% of bilateral trade by value.
India agreed to cut automobile tariffs from up to 110% to 10% over five years, with quota-based access for 250,000 EU vehicles annually.
EU duty savings for exporters estimated at up to €4 billion annually once implemented.
Indian exports to gain zero-duty access in EU for: textiles, apparel, marine products, leather, footwear, chemicals, gems, and jewellery.
Expected to enter into force in late 2026 or early 2027 after legal scrubbing and ratification.
Negotiations had been stalled since 2013 and were re-launched in 2022.

Connection to this news: The Netherlands — as a founding EU member and major trade hub (Rotterdam is the EU's largest port) — stands to gain disproportionately from the India-EU FTA, making the bilateral strategic upgrade timely and economically motivated.

Critical Minerals and Strategic Supply Chains

The 17 pacts included an agreement on critical minerals, reflecting a global scramble to secure supply chains for minerals essential to clean energy and semiconductor manufacturing (lithium, cobalt, nickel, rare earth elements). India's Critical Minerals Mission (2024) identified 30 critical minerals; the Netherlands' advanced battery, EV, and semiconductor industries require many of the same inputs.

India holds significant reserves of: mica, barites, chromite, coal, iron ore, and limestone; critical mineral deposits include lithium (Reasi, J&K — confirmed 2023), cobalt, and REEs.
The Geological Survey of India (GSI) has been tasked with accelerated critical mineral mapping under India's Critical Minerals Mission.
Critical minerals have become a central theme in India's bilateral agreements with Australia, the EU, Japan, and now the Netherlands.

Connection to this news: A bilateral critical minerals pact with the Netherlands gives India access to Dutch processing and refining technology, while offering the Netherlands supply-chain diversification away from China, which currently dominates 60–80% of global critical mineral processing.

Key Facts & Data

Tata-ASML Dholera fab investment: USD 11 billion (INR ~91,000 crore); planned capacity: 50,000 wafers/month.
Government of India's ISM subsidy share in Dholera: 50% (approximately USD 5.5 billion).
India-Netherlands cumulative FDI (2000–2025): USD 55.6 billion — Netherlands is India's 4th largest FDI source.
Bilateral merchandise trade (2024-25): USD 27.8 billion.
Number of pacts signed: 17, including the Strategic Partnership Roadmap 2026-2030.
ASML founded: 1984 (Veldhoven, Netherlands); sole manufacturer of EUV lithography machines.
India Semiconductor Mission launch: December 2021; outlay: ₹76,000 crore; capital subsidy: 50%.
India-EU FTA concluded: January 2026; covers ~2 billion people, ~25% of global GDP.
Dholera Special Investment Region: part of Delhi-Mumbai Industrial Corridor (DMIC).
Process nodes at Dholera: 28 nm, 40 nm, 55 nm, 90 nm, 110 nm (licensed from PSMC, Taiwan).
Netherlands: India's largest export destination in Europe and 4th largest overall FDI source.
Joint Centres of Excellence in agriculture: 25 planned, 7 functional.