Intel and TSMC express interest in building chip factories in India

India is in talks with global chipmakers Intel Corp, GlobalFoundries Inc and TSMC to build local operations as part of an effort to concentrate more high-tech manufacturing in the country.

Late last year, Prime Minister Narendra Modi’s government unveiled a $10 billion stimulus package offering up to half the cost of the project to persuade display and semiconductor makers to set up bases in India. China has set itself an ambitious goal of becoming the world’s electronics factory, following its neighbor’s lead.

“I do most of the publicity for these big companies myself,” Rajeev Chandrasekhar said. “We meet with CEOs, talk to them, give presentations.”

Chandrasekhar and India face a steep climb, with companies like TSMC and Samsung Electronics spending tens of billions of dollars a year on chip capacity expansion and demanding logistics, water and power requirements at each site. However, both companies have accepted demands from foreign buyers and are now building new factories in the United States following an agreement with the local government.

In India, a joint venture between billionaire Anil Agarwal’s Vedanta Group and Foxconn Technology Group has shown interest in setting up semiconductor foundries in the country, but Intel and TSMC have yet to make any commitments. Challenges such as power outages and unstable infrastructure remain. But Chandrasekhar said Indian states are actively competing for semiconductor investment. “They’re all willing to sit down and discuss other incentives they can offer investors besides land. This is a very competitive investment coveted by the states,” the minister said.


To lure smartphone assemblers, the Indian government levies import duties on devices made elsewhere and provides economic incentives for local manufacturing. Backed by India’s large and growing smartphone user base, the effort was successful and made India the second-largest smartphone maker in the world. Samsung, Xiaomi and other companies. And Taiwan suppliers Hon Hai Precision Industry Co., Ltd., Wistron Capital Co., Ltd. Pegatron Group. Apple Inc. manufactures all devices locally. New Delhi now hopes to replicate this success with key components such as silicon chips.

India’s semiconductor manufacturing plans come as major economies are increasingly investing resources to secure their domestic chip production. China has laid out a vision for semiconductor sovereignty, the Biden administration has a $52 billion plan to regain the U.S. lead in chip development, and Japan has pledged billions to lure companies like TSMC. Trade tensions between Beijing and Washington, as well as coronavirus-related lockdowns, have disrupted global supply chains and pushed companies to diversify beyond traditional tech hubs such as China and Taiwan.


Intel CEO Pat Gelsinger met with the Prime Minister of India and a delegation led by US CEO John Neuffer earlier this month. The Semiconductor Industry Association also visited the country.

“Everyone is interested, it’s a matter of their plans,” Chandrasekhar said ahead of a three-day semiconductor conference at the Bengaluru South Technology Center. The event, organized by the government to attract global semiconductor companies, has begun.


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