In December 2021, the Government of India launched the India Semiconductor Mission (ISM). Of the 12 semiconductor projects approved so far, six have come to Gujarat alone.

Out of the country's total semiconductor investment pipeline of ₹1.64 lakh crore, Gujarat has attracted more than ₹1.24 lakh crore. In other words, nearly three out of every four rupees being invested in India's chip ecosystem are flowing into the state.

This is not merely a story of investment. It is a story of what Gujarat has done differently that other industrial states have not.

Industry estimates suggest that India's semiconductor market will grow from US$ 38 billion in 2023 to US$ 100–110 billion by 2030.

PM’s Vision

Dholera in Ahmedabad district already has India's first silicon fabrication plant.

Prime Minister Narendra Modi, while inaugurating the commercial production of CG Power’s OSAT (Outsourced Semiconductor Assembly and Test) facility at Sanand in Ahmedabad district on July 4, said his dream of building a semiconductor ecosystem in India, envisioned nearly two decades ago, has now become a reality.

The Sanand plant will initially produce 200 million semiconductor chips annually, with a long-term target of 5 billion chips per year. At full capacity, the facility is expected to manufacture nearly 15 million chips every day.

Export Plans

Union Minister for Electronics and Information Technology Ashwini Vaishnaw said semiconductor chips manufactured in Gujarat will be exported to Japan, the United States, and Europe.

He added that the Sanand facility was the third semiconductor plant to commence production out of the 12 approved semiconductor projects in India. Two more plants are expected to begin production before the end of this year.

To support the rapid growth of the semiconductor sector, Vaishnaw said that 315 universities across the country are currently offering semiconductor design courses to develop a skilled workforce for the industry.

An Entire Ecosystem

In Sanand, companies such as Micron Technology, CG Power, and Kaynes are building what is emerging as India's largest Semiconductor Packaging Cluster. With Suchi Semicon in Surat and Crystal Matrix in Dholera, Gujarat is also making rapid progress in compound semiconductor manufacturing.

This means Gujarat is no longer just a state that manufactures chips. It is creating the entire semiconductor value chain — from design and fabrication to assembly, testing, and packaging.

That is why industry observers are increasingly describing Gujarat not merely as a manufacturing destination, but as India's semiconductor ecosystem state.

What Gave Impetus 

For years, industries have complained that securing approvals in Gujarat is not always easy. Delays related to land acquisition, environmental clearances, electricity, and other regulatory processes have held things back.

In fact, when industrialisation is discussed, Maharashtra is usually the first state that comes to mind. Yet in semiconductors, neighbouring Gujarat has taken a decisive lead.

So how did the semiconductor sector move at such speed?

The reason is not subsidies alone.

The Dholera Special Investment Region, Sanand's manufacturing ecosystem, an early semiconductor policy, ready industrial land, reliable power and water supply, ports, air connectivity, and strong coordination between the Centre and the State have together created a compelling proposition.

Semiconductor companies do not simply look for cheap land. They look for a reliable ecosystem. Gujarat appears to have built that confidence.

From Consumer to Producer

The Government of India launched ISM with an incentive package of ₹76,000 crore, sending a clear message that India intends to become a semiconductor producer rather than merely a consumer.

Today, the country's 12 approved projects include one Silicon Fab, two Compound Semiconductor Fabs and nine ATMP/OSAT facilities.

The government is providing financial support of up to 50% of project cost. Under ISM 2.0, the focus has expanded beyond chip manufacturing to include semiconductor equipment, materials, R&D, indigenous design capabilities, and supply-chain development.

Chips Built in Classrooms

The semiconductor business is not only about factories. It is equally about talent.

More than 67,000 students and over 1,000 startup engineers across India are currently working on chip design using Electronic Design Automation (EDA) tools.

Academic institutions have completed 122 chip tape-outs, leading to the fabrication of 56 chips, while startups have completed 16 tape-outs and developed six advanced chips.

India is therefore preparing not only semiconductor factories, but also the next generation of chip designers.

Attracting Semiconductor Projects

There are several structural reasons behind Gujarat's success.

It was the first state in India to introduce a dedicated semiconductor policy. It also has an electronics policy aligned with the Central government's SPECS (Scheme for Promotion of Manufacturing of Electronic Components and Semiconductors).

The objectives of the India Semiconductor Mission align closely with Gujarat's industrial strategy. Besides, Prime Minister Narendra Modi and Union Home Minister Amit Shah have taken an active interest in promoting semiconductor investments.

Industrial land in Sanand and Dholera has been earmarked specifically for semiconductor manufacturing. Gujarat offers strong road, rail, port, and airport connectivity. Rising demand from smartphones, EVs, and defence manufacturing have further strengthened the state's case.

Bigger Game Lies Ahead

The government's target is to enable India to design and manufacture 70%–75% of the chips required for domestic consumption by 2029.

If this vision materialises, the next five years will not just bring more semiconductor factories — they could attract the entire global semiconductor supply chain to India.

If other states fail to catch up, Gujarat is widely expected to maintain its commanding lead.