The Indian government is currently evaluating investment proposals worth $21 billion aimed at promoting chip manufacturing within the country. These proposals include a range of ventures from both domestic conglomerates and international firms. Tower Semiconductor Ltd. from Israel has submitted a significant proposal of $9 billion to establish a semiconductor plant in Gujarat, which is the home state of Prime Minister Narendra Modi.

Similarly, the Tata Group of India has proposed an $8 billion project to establish a chip manufacturing facility in an identical area. The semiconductor industry has become a crucial battleground for geopolitical competition, with numerous countries such as the US, Japan, and China striving to bolster their local chip sectors. Prime Minister Narendra Modi's government is enthusiastic about positioning India as a worldwide manufacturing center, employing incentives to entice international chip manufacturers while supporting domestic leaders.

The endeavour aims to reduce reliance on costly imports and fortify India's foothold in industries like smartphone assembly. Under India's incentive plan for chip manufacturing, the government is set to subsidize half of the approved projects' costs, with an initial allocation of $10 billion earmarked for this purpose. Despite past setbacks, such as the collapse of high-profile partnerships, India remains steadfast in its pursuit of semiconductor self-sufficiency.

Significantly, financial incentives have already attracted investments from tech giants such as Apple and Google, driving the expansion of India's electronics manufacturing ecosystem. Tower Semiconductor plans to gradually expand its proposed plant over the course of a decade to manufacture 80,000 silicon wafers per month, potentially achieving a significant milestone as the initial manufacturing unit in India operated by a leading semiconductor company.

Likewise, the venture by the Tata Group is expected to involve collaboration with Powerchip Semiconductor Manufacturing Corp. Both endeavors concentrate on producing established chips utilized across various industries such as consumer electronics, automotive, and defense. Concurrently, the Tata Group is considering the creation of a $3 billion chip-packaging facility in eastern India. These initiatives are in line with Tata's overarching strategy to broaden investments into advanced technology sectors, leveraging its current involvement in smartphone components and assembly.

At the same time, Renesas Electronics Corp from Japan is investigating possibilities for cooperation within India's rapidly expanding chip-packaging sector. The destiny of these ambitious proposals now lies in the hands of Modi's cabinet, which is anticipated to render decisions in the forthcoming weeks. To be eligible for state subsidies, applicants are required to provide extensive information covering aspects such as technological collaborations, financing agreements, semiconductor specifications, and target demographics.