India approves four more semiconductor projects

India’s Union Cabinet has approved four more semiconductor projects worth Rs 4,600 crore ($554m).

The approved proposals were from SiCSEM, Continental Device India Private Limited, 3D Glass Solutions and Advanced System in Package Technologies, with manufacturing units to be set up in Odisha, Punjab and Andhra Pradesh.

SiCSEM is establishing an integrated silicon carbide compound semiconductor facility in Bhubaneshwar, Odisha, and the commercial compound fab will have the capacity to produce 60,000 wafers annually and package 96 million units.

The latest announcement follows a trio of projects in March, as India seeks to ramp up its semiconductor sector and create ‘technological self reliance’. Currently around 90% of its semiconductor chips are imported.

By 2030, the global semiconductor industry is expected to grow to $1 trillion and Indian semiconductor demand is expected to cross $110bn.

Catalysts include India’s young workforce specialising in technology, surging demand for consumer electronics, accelerated enterprise adoption of advanced chips, and proactive policy frameworks introduced by the Indian government to stimulate local industry.

But challenges include the lack of advanced chip fabs and a complete supply chain, especially in areas like silicon wafer production and photolithography. Infrastructure gaps, such as the need for ultra-pure water and steady power, also create hurdles, according to Straits Research.

The high cost of building fabs makes private investment difficult, and a shortage of skilled professionals in microelectronics and materials science exists. Environmental concerns are another issue, as chip manufacturing uses a lot of energy and produces hazardous waste.