Context:

Recently, Union Minister for Electronics and Information Technology, Ashwini Vaishnav, announced that the country's first indigenously designed 7-nanometer processor, 'Shakti,' will be ready by 2028. This is a major achievement in India's semiconductor sector. The project, led by IIT Madras, marks India's entry into advanced semiconductor design. 7-nanometer chip design has long been dominated by global leaders like Taiwan, South Korea, and the United States.

About the Shakti Project:

• • • The Shakti processor project, initiated in 2013 by IIT Madras, aims to develop a range of open-source, indigenous processors. It is based on the RISC-V architecture, which is freely available and allows anyone to design processors without licensing costs.
    • Over the years, the project has produced various processor prototypes for embedded systems, industrial use, and defense applications. Now, it is taking a leap forward to design a 7-nanometer processor, which will be suitable for high-performance applications such as:
      • IT servers used in banking and finance
      • Communication systems
      • Defence and strategic sectors

The project operates under the Ministry of Electronics and Information Technology (MeitY) and aligns closely with the India Semiconductor Mission (ISM), the government’s flagship programme to develop end-to-end semiconductor and display manufacturing capabilities in the country.

India’s Leap to 7 nm – Why It Matters:

Designing a 7 nm processor is a massive technological leap. For context, modern smartphones and supercomputers rely on chips ranging from 3 nm to 7 nm, which offer higher transistor density, faster speeds, and greater energy efficiency.

The indigenous development of such advanced chips offers several strategic advantages:

• • • Technological self-reliance: Reduces dependence on imported chips for critical sectors.
    • Strategic security: Strengthens India’s control over data and defense technologies.
    • Industrial readiness: Prepares India for future domestic chip fabrication (“fab”) units.
    • Global competitiveness: Positions India among countries advancing research at cutting-edge semiconductor nodes.

When the chip design is ready in 2028, India’s first semiconductor wafer fabrication (fab) plant will also be operational, allowing indigenous mass production of advanced chips.

India’s Semiconductor Landscape:

• • • India’s semiconductor consumption was estimated at $38 billion in 2023, with projections to reach $109 billion by 2030, growing at a CAGR of around 13%.
    • However, despite this booming demand, India still imports over 80% of its semiconductors from countries like Taiwan, China, and South Korea. This dependency exposes India to supply chain disruptions and geopolitical risks.

The government is addressing these gaps through a series of initiatives:

1. India Semiconductor Mission (ISM):

Launched in December 2021 with an outlay of ₹76,000 crore, ISM serves as the central agency driving India’s semiconductor and display ecosystem. It operates under MeitY and focuses on:

• • • • Establishing semiconductor fabs and display manufacturing units
      • Setting up assembly, testing, marking, and packaging (ATMP/OSAT) facilities
      • Supporting chip design startups through fiscal incentives and mentorship
      • Building talent and research capacity

ISM has already approved 10 major semiconductor projects across six states, attracting investments exceeding ₹1.6 lakh crore.

2. Production Linked Incentive (PLI) Scheme:

The PLI scheme offers up to 50% fiscal support for semiconductor manufacturing projects. It encourages global and Indian companies to establish large-scale fabs and assembly facilities in India.

3. Design Linked Incentive (DLI) Scheme:

The DLI scheme promotes domestic chip design by providing financial and infrastructure support to startups, MSMEs and academic institutions.

• • • • Over 288 academic institutions are currently part of the programme.
      • 23 design projects have been approved, creating an expanding base of design talent.

4. Semicon India Programme:

This umbrella initiative supports R&D in advanced technologies, packaging, and testing. It aims to integrate India’s semiconductor development with emerging sectors like AI, quantum computing, and electric mobility.

5. Global Collaborations:

India has signed agreements with:

• • • • Micron (US) for semiconductor manufacturing in Gujarat.
      • Foxconn (Taiwan) for large-scale chip and electronics production.
      • U.S. National Science Foundation for joint R&D in semiconductors, cybersecurity, and sustainable technology.

These partnerships bring both capital and advanced know-how to India’s ecosystem.

Strategic and Economic Impact:

• • • Investment and Jobs: The semiconductor ecosystem is expected to generate over one million skilled jobs by 2030, spanning chip design, fabrication, and advanced packaging. It will also catalyse innovation across sectors like electronics, EVs, and defense.
    • Export Potential: The “Make in India for the World” approach will allow India to produce chips for both domestic and international markets, improving its trade balance and increasing export revenues.
    • Research and Innovation: Indian institutes such as IIT Madras and IISc Bangalore are leading collaborative research in IoT chipsets, processor design, and VLSI systems.

India’s Vikram processor, developed for space and defense applications, demonstrates indigenous manufacturing capability at SCL Mohali.

Challenges:

Despite strong policy momentum, the semiconductor industry faces several critical challenges:

1.      High Capital Costs:

Setting up a semiconductor fab requires $10 billion or more, along with continuous R&D investments.

2.      Skill Shortages:

India employs around 2.2 lakh professionals in this sector, but demand may exceed 5 lakh by 2027, highlighting the need for large-scale training programmes.

3.     Dependence on Imports:

Over 80% of key materials like silicon wafers and chemicals are imported.

4.     Technological Access:

Advanced manufacturing tools (like EUV lithography) are controlled by a few global companies, limiting India’s access.

5.     Environmental Constraints:

Semiconductor production is resource-intensive, requiring high water and energy inputs, along with complex waste management systems.

Addressing the Challenges:

India is already implementing solutions to overcome these hurdles:

• • • “Chips to Startup” Programme: Training 85,000 engineers in chip design and embedded systems to build a skilled workforce.
    • National Critical Minerals Mission: Securing domestic sources of rare earth elements needed for chip manufacturing.
    • Localization Focus (ISM 2.0): Encouraging raw material and component manufacturing within India to reduce import dependence.
    • Cost Competitiveness: Studies show that semiconductor production in India could be 15–30% cheaper compared to global benchmarks due to lower operating costs.

Future Roadmap:

India’s semiconductor roadmap now focuses on:

• • • Advancing from 28 nm to 7 nm design and eventually to sub-5 nm technologies.
    • Establishing OSAT and testing facilities in states like Gujarat and Odisha.
    • Strengthening R&D infrastructure for AI, quantum, and clean energy semiconductors.
    • Expanding the Deep Tech Alliance (announced at SEMICON India 2025) with a $1 billion fund for next-generation technologies.

Conclusion:

India’s move toward developing a 7 nanometer indigenous processor represents more than a technological achievement — it marks a turning point in the country’s digital and industrial future. By merging government support, academic excellence, and private sector participation, India is laying the foundation for a self-reliant and globally competitive semiconductor ecosystem. The coming years will determine how effectively this vision translates into world-class manufacturing and innovation. If sustained with the same momentum, India could soon evolve from being one of the world’s largest semiconductor consumers to becoming a major producer and innovator — powering its digital economy with chips made at home.