Tata Electronics is set to expand its semiconductor manufacturing footprint in India by establishing two additional fabs in Gujarat’s Dholera Special Investment Region, aiming to meet growing global demand for chips. The move comes as part of Tata’s larger strategy to produce semiconductors locally, a critical step in India’s drive towards becoming a global hub for chip manufacturing. The information was shared by people familiar with the matter, according to LiveMint.
In partnership with Taiwan’s Powerchip Semiconductor Manufacturing Corporation (PSMC), Tata is already working on a Rs 91,000-crore semiconductor fab in the region. This first phase, expected to begin production by 2026, will mark India’s entry into large-scale semiconductor manufacturing. The plant is anticipated to roll out chips across multiple nodes, catering to both domestic and international markets.
While the first fab is well underway, plans for the second and third fabs are still in the early stages. The partnerships and timelines for these fabs have yet to be finalised, though industry sources suggest that production could begin within five to seven years. These fabs are expected to operate at the same scale as the first, positioning Tata to further capitalise on the global chip demand.
“The nodes and technology for the additional fabs will be determined once the first fab reaches full operational capacity,” a source revealed. “This will depend heavily on the evolution of global demand and advancements in semiconductor technology.” The first fab is set to serve as a benchmark for future expansions, allowing Tata to make informed decisions on the technology needed for the subsequent facilities.
A senior government official confirmed that groundwork for the first fab is already in progress, with construction having begun in March at Dholera. The initial phase will focus on installing the necessary capacity to test equipment and develop a pilot production line, a critical step before scaling up to commercial manufacturing.
Tata is also in discussions with potential buyers for the chips to be produced by the first fab, further indicating the company’s long-term commitment to the semiconductor market. A senior executive explained that while the first fab is expected to incur significant investment, future phases may benefit from shared infrastructure, lowering the overall costs for subsequent fabs. However, substantial investment will still be required for the additional fabs to bring them to full scale.
This ambitious expansion comes at a time when semiconductor demand is surging globally, driven by advancements in technologies like 5G, artificial intelligence, and electric vehicles. With the Dholera fabs, Tata Electronics is positioning itself as a key player in the global semiconductor supply chain, contributing to India’s goal of reducing its reliance on imported chips and establishing itself as a global semiconductor manufacturing hub.
