India's Union Cabinet has approved the establishment of a new semiconductor manufacturing facility in a joint venture between the local HCL Group and Taiwan-based Foxconn, with an investment outlay of ₹3,706 crore ($435 million). The plant will be set up close to the Jewar Airport in Uttar Pradesh, a segment of the government's India Semiconductor Mission to build a self-reliant chip ecosystem.
According to Information and Broadcasting Minister Ashwini Vaishnaw, the plant will have a monthly production capacity of 20,000 wafers. It is intended to produce 36 million display driver chips annually, used in electronic digital products like mobile phones, laptops, and automotive systems. The unit should start commercial operations in 2027, creating approximately 2,000 new jobs.
The Jewar plant is the sixth semiconductor plant to receive the green light under the national mission. Authorities consider this move necessary to increase India's power in the global electronics production value chain.
From the beginning, Prime Minister Narendra Modi has prioritized making semiconductor manufacturing a strategic choice for improving India's technological and economic status. India currently lacks an operational chip fabrication facility. The newly sanctioned HCL-Foxconn plant is expected to reduce dependence on imported semiconductors, especially in sensitive sectors, in India.
Although India's semiconductor dreams have faced setbacks, like the collapse of a $19.5 billion Foxconn-Vedanta joint venture in 2023 because of cost concerns and delayed timelines, the government presses on. Other ones in the pipeline comprise a packaging unit by a based firm Micron technology valued at $2.7 billion and Tata Group's $11 billion chip manufacturing facility. A $10 billion project suggested by the Adani Group in collaboration with Israel's Tower Semiconductor is on hold while under internal review.
The central government has observed the expanding roles of ecosystem partners serving the interests of the semiconductor sector. Applied Materials and Lam Research, global equipment manufacturers, now operate in India. Furthermore, Merck, Linde, Air Liquide, and Inox are increasing production to meet anticipated demand from the domestic chipmaking industry.
Approval of the HCL-Foxconn plant envisions taking India's semiconductor capabilities a notch higher and entices more investment. Policymakers continue prioritizing strategic and commercial partnerships to position India as a haven for semiconductor manufacturing and technology.