Union Cabinet Approves Rs 3,300 Crore Semiconductor Unit in Gujarat to Boost India’s Chip Manufacturing

New Delhi: To strengthen India’s semiconductor industry, the Union Cabinet, chaired by Prime Minister Narendra Modi, has approved a proposal by Kaynes Semicon Pvt Ltd to establish a semiconductor unit in Sanand, Gujarat. This unit, to be developed with an investment of Rs 3,300 crore, will have a capacity of producing 60 lakh chips per day.

The chips manufactured at this facility will cater to a broad range of industries, including automotive, electric vehicles, consumer electronics, telecom, mobile phones, and industrial applications. This development marks a major step in India’s effort to build a vibrant semiconductor ecosystem.

The approval falls under the Programme for Development of Semiconductors and Display Manufacturing Ecosystem in India, which was notified in December 2021 with a total outlay of Rs 76,000 crore. The program aims to establish India as a global hub for semiconductor production, meeting growing domestic and international demand.

This latest semiconductor unit follows the Union Cabinet’s earlier approvals in June 2023 and February 2024. Tata Electronics is setting up a semiconductor fab in Dholera, Gujarat, while CG Power is establishing a unit in Sanand, and another is being developed in Morigaon, Assam. Collectively, these four projects are expected to bring in investments of nearly Rs 1.5 lakh crore, with a combined capacity to produce around 7 crore chips per day.

Construction of all four semiconductor units is progressing rapidly, positioning Gujarat and Assam as emerging semiconductor hubs. The development of these units is seen as a critical move to enhance India’s self-reliance in the technology sector, reduce dependency on imports, and create a robust semiconductor manufacturing ecosystem.

The semiconductor initiative reflects the government’s commitment to making India a global player in the high-tech industry, aligning with the larger goal of “Atmanirbhar Bharat” (Self-Reliant India).