NEW DELHI: The AI boom is creating demand for new and reliable chip manufacturing hubs, Prime Minister Narendra Modi said Thursday, pitching India as a destination building the ecosystem that the global semiconductor industry needs.Inaugurating Semicon India 2026, the PM said AI was changing semiconductor requirements beyond smaller transistors, thereby propelling the importance of chip integration, data movement, heat management and dependable power.PM Narendra Modi said, “Today if you are working on AI, the challenges are not only about what is inside the chip, but also about what is happening around it.”These included bringing memory closer to processors and connecting multiple chips to function as one system. Modi said AI demand had contributed significantly to the growth of more than 20% in the global semiconductor market over the past two years.“Amid these challenges, what the world now needs most are new and reliable manufacturing locations,” he said, adding that India was preparing itself to meet that need. India had begun the $13.5-billion second phase of its Semiconductor Mission, following up on the $8-billion first phase, Modi said. Twelve projects had been approved, with the next phase expected to widen participation.He invited equipment manufacturers and suppliers of chemicals, gases and materials to invest, saying India wanted to strengthen domestic supply chains alongside chipmaking. “We want the entire ecosystem to grow together,” he said.He also invited Indian youth conducting research overseas to return to the country to contribute to advanced technology development domestically and urged industry to lead R&D initiatives. The PM identified compound semiconductors and silicon photonics as priorities for AI infrastructure.Govt had introduced reforms allowing international companies to collaborate with Indian startups, design companies and OCIowned companies, he said, while seeking to encourage fabless businesses and domestic intellectual property creation.
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PM Modi said India’s chip industry progressed from policy discussions-project announcements to commercial production stages. Indian plants were supplying customers at home and abroad, while production was beginning at two more plants in Mohali and Surat.“It takes decades to build technological capabilities. Wherever semiconductor ecosystems have been built in the world, they have been prepared after decades of effort. But India, with your cooperation, has worked simultaneously on chip design and production, equipment manufacturing, materials ecosystem, testing capability — and has shown success,” he said.“India’s success in this critical industry would strengthen global supply chains,” Modi said arguing that its significance bettered even as supply chains are being weaponised.
