PM Modi reveals he had a semiconductor plan 20 years ago. Why it never took off

Prime Minister Narendra Modi on Saturday revealed that he had drawn up a detailed plan to establish a semiconductor plant in Gujarat nearly two decades ago, but the Centre could not carry it through.

Modi served as the chief minister of Gujarat between 2001 and 2014.

On Saturday, he inaugurated the CG Semi Outsourced Semiconductor Assembly and Test (OSAT) facility in Gujarat's Sanand. 

Speaking at the event, the Prime Minister said the success of India's semiconductor push was satisfying because the idea had remained unrealised despite early efforts.

"20 years ago - perhaps even earlier - I had drawn up a complete plan to set up a semiconductor plant in Gujarat. I had finalised a site of 350 to 400 acres and even held discussions with some companies," he said. "At that time, the Government of India was making bold statements, so companies would come for talks. But for some reason, the Government of India seemed to get shackled, and the matter did not progress."

"Today, when I see this happening, I feel immense joy. Back when no one in the country discussed these topics, and when I did, the media would mock me. It didn't happen then, but seeing it happen today fills me with the greatest happiness," he added.

From An Unfulfilled Plan To A Semiconductor Push

On January 9, 2009, A Raja, then Union Minister for Communications and Information Technology, said that the Centre had received 17 proposals worth Rs 1.57 lakh crore under the Semiconductor Policy announced two years ago in 2007. However, the industry failed to take off.

A fresh push came after Modi became Prime Minister. In December 2021, his Cabinet approved the India Semiconductor Mission 1.0 with an outlay of Rs 76,000 crore, offering fiscal support of up to 50 per cent for silicon fabs, compound semiconductor facilities, assembly and testing units, and chip design.

The Union Budget 2026–27 subsequently announced India Semiconductor Mission 2.0, allocating Rs 1,000 crore with a focus on industry-led research and training centres to strengthen technology development and build a skilled workforce.

As of December 2025, the government had approved 10 semiconductor projects across six states involving investments of Rs 1.60 lakh crore.

According to a government update, which cited industry estimates, the size of the Indian semiconductor market was about $38 Bn in 2023, $45-$50 billion in 2024-2025, and is expected to reach $100-$110 billion by 2030. 

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'Semiconductor Cluster Is Being Born'

PM Modi said Sanand was emerging as one of India's semiconductor manufacturing hubs.

"I have been told that 20 crore chips will be produced here annually. I am told you aren't stopping there; you have set a target of 500 crore chips annually - that is, over 1.5 crore per day," the Prime Minister said while gesturing towards Vellayan Subbiah, Chairman of CG Power.

"I am absolutely confident that you will achieve this very soon. This confidence also stems from the fact that the Semicon India program is gaining momentum - step by step, brick by brick, and now, chip by chip."

The Prime Minister said industrial strength is built through clusters rather than individual factories, citing Silicon Valley in the United States, Taiwan's Hsinchu Science Park, Japan's Silicon Island and Tsukuba Science City as examples.

"Today, Sanand too is moving in that direction," he said.

The Prime Minister also said that within just a few months, Micron, Kaynes, and CG Semi have started production in Sanand. "A semiconductor cluster is being born in India. Today, chip packaging is happening here. Tomorrow, specialised companies will come, chemicals will be produced, new testing labs will be built, industries servicing machines will emerge, design centers will open, and startups will be born. This is the strength of clusters."

He said one industry gives birth to hundreds and hundreds of industries create millions of jobs, and millions of jobs transform the economy of an entire region. "And this is not happening only in Sanand - semiconductor clusters are emerging in many states across India."

India-Made Chips To Reach Global Markets

Union Electronics and IT Minister Ashwini Vaishnaw said chips produced at the Sanand facility would be used in automobiles and industrial applications and exported to major international markets.

"The chips manufactured at this plant will be used in cars, scooters, and various industrial applications; and - most significantly - chips made in India, at this facility, will be exported to Japan, America, and Europe. Indian technology will earn global acclaim," Vaishnaw said.