India has taken another decisive step toward strengthening its semiconductor ecosystem as India Chip, a joint venture between HCL Group and Foxconn, begins construction of its semiconductor facility in Noida. The upcoming plant aims to process up to 20,000 wafers per month once fully operational in 2028, significantly boosting domestic production of display driver chips.

Backed by an investment of Rs 3,700 crore, the facility marks a major milestone in India’s ambition to reduce reliance on imported semiconductors and develop a resilient, homegrown chip manufacturing supply chain.

Foundation Stone Laid by Prime Minister Narendra Modi

The foundation stone for the project was recently laid by Narendra Modi, who joined the ceremony virtually. The event was also attended by Yogi Adityanath and Ashwini Vaishnaw.

The plant is being built near Jewar along the Yamuna Expressway in Uttar Pradesh, a region that is rapidly emerging as a key electronics and manufacturing hub.

What the India Chip Facility Will Manufacture

The Noida plant will function as an advanced Outsourced Semiconductor Assembly and Test (OSAT) unit. Rather than fabricating chips from scratch, the facility will:

Assemble semiconductor components

Package integrated circuits

Test display driver chips for performance and reliability

The primary focus will be on display driver integrated circuits (ICs), essential components that power screens in:

Smartphones

Televisions

Laptops

Tablets

Other consumer electronics

Display driver chips play a critical role in translating digital signals into visible images on screens, making them indispensable in today’s digital-first economy.

Processing Capacity: 20,000 Wafers Per Month

Once fully operational in 2028, the India Chip OSAT plant is expected to process up to 20,000 wafers per month. This scale of production positions the facility as one of India’s most significant semiconductor assembly and testing units.

According to company estimates:

The plant could meet nearly 25% of India’s domestic demand for display driver chips.

Approximately 20–30% of output may be exported to global markets.

Currently, India relies entirely on imports for display driver ICs. Local production is expected to reduce external dependencies while strengthening supply chain resilience.

Structure of the Joint Venture

India Chip has been structured as a 60:40 joint venture:

60% stake: HCL Group

40% stake: Foxconn

This partnership combines HCL’s domestic industrial presence and technological expertise with Foxconn’s global electronics manufacturing capabilities. The collaboration reflects a strategic alignment aimed at accelerating India’s semiconductor ambitions.

Boosting India’s Semiconductor Ecosystem

The project comes at a time when India’s electronics manufacturing sector is expanding rapidly, especially in smartphones and consumer devices. As production volumes grow, so does the demand for critical components like display driver chips.

By localising semiconductor assembly and testing, the India Chip facility is expected to:

Reduce import dependence

Improve supply chain stability

Enhance value addition within India

Strengthen the country’s semiconductor infrastructure

Beyond direct manufacturing, the plant is projected to generate over 3,500 direct and indirect jobs. It may also catalyse the development of a broader semiconductor ecosystem, including:

Component suppliers

Logistics providers

Testing and certification services

Ancillary manufacturing units

Strategic Importance of OSAT Facilities

While chip fabrication (fab) plants often attract the most attention, OSAT units are equally critical in the semiconductor value chain. After wafers are fabricated, they must undergo assembly, packaging, and rigorous testing before integration into electronic products.

By establishing a domestic OSAT facility capable of high-volume processing, India strengthens a crucial stage of chip production — one that ensures performance reliability and market readiness.

This move signals India’s intent to transition from being primarily an electronics assembly destination to a higher-value semiconductor manufacturing hub.

Looking Ahead: Operations Targeted for 2028

Construction of the Noida facility is now underway, with operations expected to begin in 2028. Once operational, the plant will serve both domestic and international markets, reinforcing India’s position in the global semiconductor supply chain.

As geopolitical shifts and supply chain disruptions continue to reshape global electronics manufacturing, projects like India Chip represent foundational investments in long-term technological self-reliance.

Conclusion

The launch of construction for the India Chip factory in Noida marks a pivotal moment in India’s semiconductor journey. With a planned capacity of 20,000 wafers per month, significant job creation potential, and the ability to meet a substantial portion of domestic demand for display driver chips, the project underscores India’s strategic push toward self-sufficiency in high-value electronics manufacturing.

As the facility progresses toward its 2028 operational target, it stands as a key pillar in India’s broader mission to build a robust, resilient, and globally competitive semiconductor ecosystem.