Applied Materials, a leading US semiconductor equipment manufacturer, has announced plans to invest $5 billion in India over the next ten years. This commitment was made during the SEMICON India conference, a major gathering for the semiconductor industry, held in New Delhi.
The three-day event showcased India’s ambitions in the semiconductor sector, bringing together over 600 companies and representatives from 52 countries. With the global demand for chip production soaring, particularly due to the rise in AI technology, the industry is facing challenges amid political tensions between the US and China.
In the backdrop of export restrictions between Washington and Beijing, India has positioned itself as a reliable partner for companies looking to shift their operations away from Taiwan and China. Prime Minister Narendra Modi emphasized India’s readiness, stating, “The world stands in utmost need of new and reliable manufacturing locations. I say with great responsibility that India is continuously preparing itself for this.”
According to government forecasts, India’s semiconductor consumption is expected to reach around $110 billion by 2030, significantly up from $45-$50 billion projected for 2025. Applied Materials plans to focus its investment on research, expanding the supply chain, and workforce development in India.
Despite its recent efforts, India remains a newcomer to the capital-intensive semiconductor industry, competing with nations like Taiwan that have spent years building their capabilities. Over the last five years, India’s incentive programs have led to the approval of twelve projects, including three chip-packaging plants, one of which is operated by US-based Micron Technology, and has started commercial production.
However, India has yet to produce a semiconductor from a large-scale fabrication plant. The flagship project, a $10 billion chip manufacturing facility by Tata Electronics in Gujarat, has experienced delays and is nearly two years behind schedule.
