Blitz India Business
NEW DELHI: Of the twelve semiconductor units India has approved, nine do packaging and one is a silicon fab. That ratio has been read as timidity. It is closer to the opposite.
India’s semiconductor programme has approved twelve manufacturing units carrying more than ₹1.64 lakh crore of committed investment. The composition is one silicon fab, one silicon carbide fab, an integrated gallium nitride micro-LED display fab, and nine assembly, testing, marking and packaging units. Three of the twelve are operational: Micron’s facility at Sanand, inaugurated on 28 February 2026, and Kaynes Semicon’s plant at the same location on 31 March 2026 are the visible ones. The Cabinet cleared the framework for the programme’s second phase on 15 July 2026, and the Tata–PSMC fab at Dholera is under construction with first silicon targeted for December 2026.
The nine-to-one ratio is the design, not an accident of what was on offer. Every country that has built a semiconductor industry from a standing start has faced the same sequencing question, and the historical answer is consistent: back-end first. Assembly and packaging plants cost a fraction of a leading-edge fab, come online in eighteen to thirty months rather than four to six years, and employ engineers and technicians in numbers a fab does not. Crucially, they create the thing a fab cannot be built without — a workforce that has handled wafers, a supplier network for ultrapure chemicals and gases, a customs and logistics chain that can move sensitive material without damaging it, and a set of local firms that have passed a multinational’s quality audit.
The order of operations: packaging plants take eighteen to thirty months to reach production against four to six years for a leading-edge fab — which is why the ecosystem is usually built from the back end forward.
A fab without an ecosystem is an expensive building. The nine packaging plants are what makes the one fab work.
At a Glance
• Units approved: twelve
• Committed investment: more than ₹1.64 lakh crore
• Silicon fabs: one
• Silicon carbide fabs: one
• Display fab: one, integrated gallium nitride micro-LED
• Packaging units: nine
• Operational: three of the twelve
• Micron, Sanand: inaugurated 28 February 2026
• Kaynes Semicon, Sanand: inaugurated 31 March 2026
• Dholera fab: first silicon targeted December 2026
There is a second, less-discussed reason the sequence favours India specifically. Advanced packaging has become the frontier of performance improvement in its own right. As gains from shrinking transistors have slowed, chiplet architectures, three-dimensional stacking and high-density interposers have become where meaningful performance is added — and those are packaging problems. A country entering the industry through the back end in 2026 is not entering through the low-value door that the same choice would have represented in 2006. It is entering at a point where the packaging step captures a rising share of the value of the finished device.
The honest caveats stand. Three operational units out of twelve approved is an early figure, and semiconductor construction timelines slip routinely, in every country, for reasons ranging from tool delivery to water and power qualification. The December 2026 target for first silicon at Dholera should be read as an ambition rather than a schedule. But the strategic question is whether the sequence is right, and on that the record of every successful late entrant points the same way. India’s constructive task now is unglamorous and specific: get the remaining nine units into production, hold the power and ultrapure-water quality that fabs require, and keep expanding the trained technician pipeline that all twelve draw from. Get those right and the fabs follow. Get them wrong and the fab is an expensive building.