Blitz India Business
NEW DELHI: The India Semiconductor Mission has entered its second phase with an outlay of ₹1.27 lakh crore, and the widening of scope is the substantive change. ISM 1.0 was largely a fab-attraction programme. ISM 2.0 funds the ecosystem that a fab requires in order to be viable: chip design, display manufacturing, advanced packaging, the capital equipment and speciality materials that fabs consume, research, and the specialised workforce the sector runs on. That shift matters because a fabrication plant without a surrounding supplier base is an expensive import-substitution exercise; with one, it is an industry.
The physical build-out has moved past the announcement stage. Ten semiconductor units have been approved as of March 2026 — two fabrication plants and eight assembly, testing, marking and packaging facilities. Five plants are expected to be operational by the end of 2026, of which three are already in commercial production, with two more due to be inaugurated in the months ahead. Kaynes Semicon’s OSAT unit at Sanand in Gujarat reached commercial production in March 2026, fourteen months after breaking ground — a construction-to-production interval that compares respectably with international benchmarks.
First silicon is the milestone: Dholera targets its first wafers off the line in December 2026 — the point at which India moves from packaging chips to fabricating them.
Ten approvals, five plants, one date that matters: December, and the first wafer off the Dholera line.
At a Glance
• ISM 2.0 outlay: ₹1.27 lakh crore
• Scope: fabs, chip design, displays, advanced packaging, equipment and materials, research, talent
• Approved units: 10 as of March 2026 — two fabs and eight ATMP/OSAT facilities
• Operational by end-2026: five plants; three already in commercial production
• Flagship: Tata Electronics’ fab at Dholera, Gujarat — India’s first large-scale commercial fab, built with ASML equipment and technology
• First silicon target: December 2026
• Micron: OSAT plant at Sanand packaging and testing DRAM and NAND
• Kaynes Semicon: Sanand OSAT in commercial production from March 2026, 14 months after groundbreaking
The flagship is Tata Electronics’ fabrication plant at Dholera in Gujarat, India’s first large-scale commercial fab, being equipped with technology from the Dutch major ASML. Its stated target for first silicon — the first wafers produced on the line — is December 2026. That single date carries disproportionate weight. Assembly and packaging units, of which India now has several running, capture a modest share of semiconductor value added. A functioning fab is a different category of asset, and it is the point at which India’s participation in the industry stops being conditional on somebody else’s wafer supply.
The realistic constraints are equipment lead times, ultra-pure water and uninterrupted power at fab specification, speciality chemical supply, and above all process engineers with fab experience — a global scarcity that money alone does not resolve quickly. None of these is a reason for pessimism; all of them are reasons for sequencing. The constructive approach is the one ISM 2.0 has already adopted in principle: fund the ecosystem in parallel rather than in series, so that when Dholera produces its first wafer there is a domestic materials and equipment base to serve it and a trained cohort to run the next line. Publishing a rolling, dated capability roadmap — which node, which capacity, which quarter — would let component buyers and equipment suppliers commit capital against it. India has crossed the point where the semiconductor mission needs more announcements. What it needs now is schedule discipline, and the December target is the first public test of it.