What Happened
- Union Minister for Electronics and IT Ashwini Vaishnaw stated that global firms now trust India for their most advanced semiconductor work, moving beyond back-office support to frontier-level design and engineering.
- India's design capabilities have reached a stage where companies undertake end-to-end chip design in the country — from product definition to silicon validation.
- The Minister inaugurated facilities by Texas Instruments (new R&D centre) and Zetwerk Electronics (advanced manufacturing for aerospace, defence, and automotive electronics) in Bengaluru during the same visit.
- Vaishnaw outlined India Semiconductor Mission 2.0 (ISM 2.0) priorities: chip design, equipment supply chain development, and talent building for the "fifth industrial revolution."
Static Topic Bridges
India Semiconductor Mission (ISM) — Phase 1 and 2.0
India Semiconductor Mission was launched in December 2021 under the Ministry of Electronics and Information Technology to build a complete semiconductor ecosystem covering chip design, fabrication, packaging, materials, and equipment. ISM 2.0 was announced in the Union Budget 2026-27, marking a shift from ecosystem creation to ecosystem consolidation and global integration.
- ISM is supported by a total incentive framework of Rs 76,000 crore, offering fiscal support of up to 50% for silicon fabs, compound semiconductor facilities, assembly and testing units, and chip design
- ISM 2.0 has a provision of Rs 1,000 crore for FY 2026-27, with emphasis on industry-led research and training centres
- As of December 2025, 10 projects with total investment of Rs 1.60 lakh crore have been approved across 6 states — including silicon fabrication units, silicon carbide fabs, advanced memory packaging facilities, and assembly and testing infrastructure
- ISM's Design-Linked Incentive (DLI) scheme currently supports 24 semiconductor design startups, which have attracted nearly Rs 430 crore in venture capital funding
- By 2029, India is expected to design and manufacture chips for 70-75% of domestic applications
Connection to this news: Vaishnaw's assertion that global firms now entrust India with their most advanced design work validates ISM's strategy of positioning India as a chip design hub, with ISM 2.0 further prioritising design, equipment, and talent over mere fabrication.
India's Semiconductor Design Workforce
India accounts for approximately 20% of the global semiconductor design workforce, with over 1 lakh VLSI design engineers working in both multinational and domestic design companies. This talent base, concentrated in Bengaluru, Hyderabad, Chennai, and Pune, forms the backbone of India's semiconductor ecosystem.
- Texas Instruments opened India's first semiconductor R&D centre in 1985; Intel followed in 1988, developing one of its largest design facilities outside the US
- Of the 10 lakh semiconductor jobs projected by FY 2026-27, approximately 3 lakh will be in fabrication and 2 lakh in Assembly, Testing, Marking, and Packaging (ATMP)
- The government is developing 85,000 skilled professionals in semiconductor design over 10 years and providing Electronic Design Automation (EDA) tools to institutions
- Over 45,000 students from 100 institutions are enrolled in semiconductor training programmes so far
- Major multinationals operating design centres in India include Intel, AMD, Nvidia, Texas Instruments, Samsung Semiconductor, Qualcomm, and Applied Materials
Connection to this news: The Minister's claim that global firms trust India for "most advanced" work rests on this four-decade-old talent ecosystem, which now enables end-to-end chip design domestically rather than fragmented support roles.
Semiconductor Value Chain — Design vs Fabrication
The global semiconductor industry operates on a design-fabrication split model. "Fabless" companies design chips but outsource manufacturing to dedicated foundries (e.g., TSMC, Samsung Foundry, GlobalFoundries). Design encompasses architecture definition, RTL coding, physical design, verification, and tape-out — the final stage where design files are sent to the foundry for mask creation and fabrication.
- Tape-out is the critical milestone marking the end of the design phase and beginning of the manufacturing process; the term originates from the historical practice of sending design data on magnetic tape to fabs
- The design file format is GDSII (Graphic Data System), which contains geometric descriptions of every layer of the chip
- The fabless model allows countries to participate in the semiconductor value chain without building multi-billion-dollar fabrication plants
- India's strength lies in the design segment; fabrication is being developed through ISM-approved fab projects by Tata Electronics, CG Power, and Micron (packaging)
Connection to this news: When Vaishnaw says India handles "end-to-end" chip work from "product definition to silicon validation," he refers to the full design cycle culminating in tape-out — positioning India as a complete design destination within the fabless model.
Key Facts & Data
- India represents ~20% of the global semiconductor design workforce
- ISM incentive framework: Rs 76,000 crore (up to 50% fiscal support)
- ISM 2.0 allocation for FY 2026-27: Rs 1,000 crore
- 10 projects approved under ISM with Rs 1.60 lakh crore total investment across 6 states
- 24 design startups supported under DLI scheme; Rs 430 crore in VC funding raised
- Target: India to design and manufacture chips for 70-75% of domestic applications by 2029
- 85,000 skilled semiconductor design professionals being developed over 10 years
- 45,000+ students enrolled from 100 institutions in semiconductor training