New Delhi: India is working towards becoming independent in designing and producing sophisticated microchips under its semiconductor mission, while also attracting Indian professionals with chip-design experience at multinational companies (MNCs), Niti Aayog member Vijay Kumar Saraswat said.
Saraswat, who is also the Chancellor of Jawaharlal Nehru University and a former secretary of the Defence Research and Development Organisation (DRDO), said that it is a well-established fact that Indian designers contribute to virtually every chip produced globally. However, their work is primarily for multinational companies, and they are often limited to designing subsystems or specific components rather than complete system designs.
“As a result, while India has a large number of designers in this sector, there are very few who can do ab initio design of a complete system. There is an effort being made today that we will build this capability using those designers who have worked for MNCs so that India also becomes a fully independent chip designer. That effort is being made under the semiconductor mission,” Saraswat said in an interview with Mint.
Saraswat also said that specific features and the incentive structure under the second phase of the India Semiconductor Mission announced in Union budget 2026 are being worked out.
Finance minister Nirmala Sitharaman announced the second phase of the mission in her budget speech in February to scale up the country’s capabilities in equipment, materials, design, intellectual property rights and to fortify the supply chain. In the budget for 2026-27, the Centre announced a second tranche of incentives under the mission, five years after rolling out the first ₹76,000-crore programme.
India will also strive to explore and produce select critical minerals found domestically despite their low resource intensity making them costlier to extract, to guard against the risk of supply denial by other countries in future, Saraswat said.
India’s push to build domestic capabilities in semiconductors and critical minerals, which are vital for IT, clean energy and defence sectors, comes at a time technology is increasingly shaping industrial and military power in a de-globalising world with weakening adherence to the rule of law. Export restrictions on certain classes of advanced semiconductors had been a pain point in US-China relations in the recent past.
Vinod Sharma, chairman of the Confederation of Indian Industry’s national committee on electronics manufacturing, called semiconductor mission 2.0, which aims to build a self-reliant semiconductor ecosystem, a path-breaking initiative.
“This 'all-hands-on-the-deck' approach envisages collaboration within the capital goods, materials, semiconductor design, fabrication and packaging industries, research and academic institutions, skilling institutions, target market segments and, of course, the policy makers,” said Sharma.
It is not a one-off project but a continuation of the first phase of the mission and in conjunction with several other policies on production and design-linked incentives, electronics component manufacturing, electronic cluster schemes, and the government’s ₹1 trillion research, development and innovation fund, said Sharma.
India is currently embarking on a historic journey, setting up a semiconductor ecosystem at a pace and scale rarely seen globally, said Nipun Sharma, chief executive officer of TeamLease Degree Apprenticeship.
The talent pool with direct fabrication or Assembly, Testing, Marking and Packaging (ATMP) experience remains limited in India, while global demand for these skills is already intense, he said.
Traditional education and training models struggle to keep pace with the fast-evolving nature of semiconductor technologies, where tools, processes, and standards change every few years, said Sharma.
Semiconductor companies are sourcing much of the required talent today from other industries such as electronics manufacturing services and automotive electronics, indicating that the current expansion is being driven largely by talent mobility rather than by the net creation of skilled talent, TeamLease's Sharma added.
“While this approach enables faster scale-up in the short term, it underscores the need to build a sustainable domestic talent pipeline,” said Sharma, highlighting the need for skilling in live production environments enabling “experiential, work-integrated learning.”
India will seek to acquire critical-mineral mines in countries with which free trade agreements (FTAs) are in place, as it would be easier to strike deals with those countries, although FTAs do not directly cover mineral exploration and production, Saraswat said.
Government-to-government deals can serve as an overarching framework. “While FTAs facilitate trade and investment, the acquisition of mines is a separate process and not directly part of an FTA. However, having an FTA with a country, such as Canada, which is rich in rare earth materials and lithium, fosters stronger bilateral relations and can improve access for potential mine acquisitions,” he said.
Saraswat explained that India has limited lithium resource. “So, we may be looking for countries to supply this. The semiconductor and critical minerals will take care of the disruptive technologies which are going to drive economic growth. Self-reliance does not mean we have to produce everything indigenously. We have to be self-reliant on those areas which are controlled by other nations.”
“If the items are available freely and there are no (export) controls, and it is not economical for us to set up production facilities in our country, we will import those items. But wherever there are serious controls, despite the cost being higher in producing our own country, we shall set up facilities for production of such items. Independence from controls is one of the basic principles of self-reliance,” said Saraswat.
He also said that under the Sustainable Harnessing and Advancement of Nuclear Energy for Transforming India (Shanti) Act of 2025, private sector companies will get to install captive small nuclear power plants, subject to government oversight of import of uranium and handling of wastage, and safety riders.
The Department of Atomic Energy is actively developing designs for 220MW and 55MW small modular nuclear reactors, Saraswat said.
“Private industries have shown considerable interest, with many intending to establish SMRs (small modular reactors) for their captive power generation needs, particularly in sectors like steel, aluminum, and refining, which require substantial power. Private companies can collaborate with foreign partners or utilize Bhabha Atomic Research Centre (BARC) technologies. However, plant designs must receive approval from the Atomic Energy Regulatory Board, and fuel and waste management will remain under the government's control,” he explained.
Saraswat also said that in the past five to seven years, there has been significant emphasis on promoting defence equipment manufacturing within the private sector in India. This has led to the establishment of numerous aerospace and defence companies and the development of defence corridors. Private companies are now actively involved in major combat aircraft development programs.
“The growth of the private sector is expected to substantially increase indigenous production, thereby reducing our reliance on imports.”