Why is Gujarat Attracting Maximum Semiconductor Investments in India: Ashwini Vaishnaw Explains

Gujarat attracting maximum semiconductor investments

The semiconductor industry is taking root in India, and Gujarat appears to be its favoured destination. 2 out of 3 semiconductor units are going to be established in Gujarat .But Why is Gujarat  Attracting Maximum Semiconductor Investments in India ?According to Union Minister Ashwini Vaishnaw, the presence of a large chemical cluster in Dahej, on Gujarat’s southwest coast, is a major factor driving significant semiconductor investments to the region.

In a recent interaction with the media, Vaishnaw told about the government’s ambitious plans to establish a comprehensive semiconductor ecosystem in the country. The Union Cabinet has already approved the establishment of three semiconductor units, with construction set to commence within the next 100 days.

Gujarat is emerging as a semiconductor hub, with major players like Micron, Tata Electronics, and CG Power setting up semiconductor fabs and assembly units in the state. Micron’s semiconductor unit will be located in Sanand, while Tata Electronics, in partnership with Powerchip Semiconductor Manufacturing Corp (PSMC) of Taiwan, will construct a fab in Dholera at an investment of ₹91,000 crore. CG Power, collaborating with Renesas Electronics Corporation (Japan) and Stars Microelectronics (Thailand), will establish a semiconductor unit in Sanand with an investment of ₹7,600 crore.

Reason behind Gujarat Attracting Maximum Semiconductor Investments in India.

Vaishnaw explained that the semiconductor manufacturing process requires nearly 250 specialty gases and chemicals, and the well-established chemical cluster in Dahej(Gujarat) can conveniently fulfill the industry’s demands. “This is the practical reason why there is a gravitation towards a place like Gujarat, where the chemical industry is already there,” he stated.

The cumulative ecosystem encompassing the four approved projects represents an investment of nearly ₹1.60 lakh crore, and Vaishnaw believes that this is just the beginning. “In the next five years, we should be seeing four or five more fabs and more assembly, testing, marking, and packaging (ATMP) units,” he said.

Beyond Gujarat, the minister highlighted that at least eight more states are actively working to attract future semiconductor projects, underscoring the industry’s significance for the nation’s technological advancement. The government’s Semiconductor Mission aims to create an entire value chain for semiconductor design, fabrication, and ATMP within India. Vaishnaw emphasized the importance of a robust semiconductor ecosystem, stating, “The presence of a strong semiconductor value chain, ecosystem, and talent pipeline is the foundation for a developed nation.”

Also Read: Taiwan’s Central Role in Global Microchip Dynamics and the TSMC Dilemma


Overall, Gujarat’s well-developed chemical industry, coupled with the government’s proactive policies and ambitious targets, has positioned the state as a prime destination for semiconductor investments in India. As the nation strives to establish a comprehensive semiconductor ecosystem, Gujarat’s role as a manufacturing hub is poised to grow significantly.

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