India Boosts Semiconductor Mission with Approval of New Unit in Sanand, Gujarat

In a significant move to strengthen India's semiconductor ecosystem, the Union Cabinet, led by Prime Minister Narendra Modi, has approved a new semiconductor unit to be established by Kaynes Semicon Pvt Ltd in Sanand, Gujarat. This development is part of the India Semiconductor Mission, a broader initiative aimed at positioning India as a global hub for semiconductor manufacturing.

The new unit in Sanand represents a substantial investment of ₹3,300 crore. Once operational, it will have the capacity to produce 60 lakh semiconductor chips per day. These chips will cater to a diverse range of industries, including automotive, electric vehicles, consumer electronics, telecommunications, mobile phones, and industrial applications. This breadth of application underscores the growing importance of semiconductors in India's industrial and technological landscape.

This initiative is not isolated; it builds upon the Program for Development of Semiconductors and Display Manufacturing Ecosystem in India, which was launched in December 2021 with a total outlay of ₹76,000 crore. The program aims to foster a self-sustaining semiconductor ecosystem, reducing dependence on imports and establishing India as a key player in the global semiconductor supply chain.

The Sanand unit is part of a larger semiconductor cluster emerging in Gujarat. In June 2023, the Union Cabinet approved the first semiconductor unit in Sanand, followed by the approval of three more units in February 2024. These include a semiconductor fab by TATA Electronics in Dholera, Gujarat, another unit in Morigaon, Assam, and a second unit in Sanand by CG Power. Combined, these four units represent an investment of nearly ₹1.5 lakh crore and will collectively have a daily production capacity of approximately 7 crore chips.

Construction on these units is progressing rapidly, and the region around Sanand is transforming into a robust semiconductor hub. This concentrated development is expected to have far-reaching effects on the local economy and the national semiconductor landscape. As these units become operational, they will play a crucial role in meeting the increasing domestic demand for semiconductors and positioning India as a competitive player in the global market.

The approval of Kaynes Semicon's unit is a testament to the Indian government's commitment to developing a vibrant semiconductor ecosystem. By facilitating significant investments and encouraging domestic manufacturing, India is taking crucial steps toward technological self-reliance and economic growth in the semiconductor sector.