India\u2019s semiconductor ambitions may finally be entering a more serious manufacturing phase as Tata Electronics signed a strategic partnership with ASML (Advanced Semiconductor Materials Lithography), the Dutch company that powers much of the world\u2019s advanced chip manufacturing infrastructure.<\/p>\n
Must read: India approves first Mini\/MicroLED fab; can Crystal Matrix deliver on its big semiconductor promise?<\/a><\/p>\n On May 16, the two companies announced a Memorandum of Understanding (MoU) <\/a>to support Tata Electronics\u2019 upcoming 300 mm semiconductor fabrication plant in Dholera, Gujarat, India\u2019s first commercial wafer fab. The planned facility involves an investment of $11 billion and will manufacture chips across applications, including automotive, mobile devices and artificial intelligence (AI).\u00a0<\/p>\n The partnership is important not just because ASML\u2019s chipmaking machines are critical to semiconductor production globally, but also because it highlights a larger global push to build secure chip supply chains outside China and Taiwan.<\/p>\n \u201cIndia currently holds a unique yet asymmetric position within the global semiconductor value chain, with significant strength in design and engineering but still limited manufacturing maturity,\u201d said Ashwath Rao, industry analyst and researcher at Counterpoint Research.<\/p>\n Rao said India has built deep capabilities in semiconductor design, Very Large Scale Integration (VLSI) engineering, AI and automotive chip development, but still lacks a mature manufacturing ecosystem across wafers, materials and fabrication infrastructure.<\/p>\n Must read: Why Japan’s semiconductor consolidation is a wake-up call for India’s chip ambitions<\/a><\/p>\n \u201cAlthough India has achieved early progress in assembly and testing, its domestic semiconductor ecosystem across materials, equipment, wafers and large-scale leading-edge fabrication remains underdeveloped,\u201d he said.<\/p>\n Why the ASML partnership matters<\/p>\n ASML is one of the most strategically important companies in the global semiconductor industry. Its lithography systems are essential for producing advanced chips and access to these tools has become increasingly sensitive amid US-China technology restrictions.<\/p>\n \u201cLithography is the heart of semiconductor manufacturing and without these tools there is no commercial-scale fab, yield consistency becomes impossible and process scaling becomes extremely difficult,\u201d Rao said.<\/p>\n According to him, the Tata-ASML partnership gives India a \u201cscalable lithography foundation\u201d that could eventually support manufacturing beyond 28nm through advanced immersion deep ultraviolet (DUV) and multi-patterning capabilities.<\/p>\n The partnership also has implications beyond wafer fabrication. Rao noted that Tata\u2019s OSAT and advanced packaging roadmap could increasingly benefit from ASML\u2019s metrology and lithography optimisation capabilities as the industry moves toward chiplets, wafer-level packaging and hybrid bonding integration.<\/p>\n Must read: How Indian conglomerates are shifting India\u2019s semiconductor playbook<\/a><\/p>\n Kathir Thandavarayan, Partner at Deloitte India, said semiconductor manufacturing cannot succeed through fabs alone.<\/p>\n \u201cBuilding a globally competitive semiconductor ecosystem requires development of an end-to-end value chain that includes close collaboration with equipment manufacturers and material suppliers,\u201d he said.\u00a0<\/p>\n Thandavarayan added that securing access to lithography systems early is critical because of their \u201cextremely high capital cost, technological complexity, and long procurement lead times.\u201d\u00a0<\/p>\n \u201cBeyond equipment access, the collaboration can accelerate the development of local engineering talent, operational expertise, and process know-how, all of which are fundamental for India\u2019s long-term ambition to become a credible semiconductor manufacturing hub integrated into the global supply chain,\u201d he said.\u00a0<\/p>\n India\u2019s mature-node strategy<\/p>\n Tata Electronics is developing the Dholera fab with technology access ranging from 28nm to 110nm through its partnership with Taiwan\u2019s PSMC. Industry experts believe this focus on mature-node manufacturing is the right entry point for India rather than immediately chasing cutting-edge nodes.<\/p>\n \u201cIndia is unlikely to replicate the fab-first model or the scale-driven approach,\u201d Rao said, arguing that the country should instead pursue a \u201cdesign-led manufacturing evolution.\u201d<\/p>\n