India pledges $19.7bn for domestic chips and mobile brand
India has committed $19.7 billion to semiconductor and smartphone manufacturing, adding a new front to the global subsidy race as it seeks to break Chinese dominance in mobile devices.
The Indian government has approved a 1.9 trillion rupee ($19.7 billion) package to build its domestic technology sector. The cabinet allocated $13.3 billion for semiconductors and $6.5 billion for mobile phone manufacturing. The funding covers chip design, fabrication, research, and talent creation.
The strategy is explicitly aimed at challenging the current market leaders. “The Prime Minister has given us clear guidance that we must create an Indian mobile brand,” Technology Minister Ashwini Vaishnaw told reporters in New Delhi. The smartphone subsidies are designed to support domestic manufacturers in a market currently dominated by Chinese companies.
New Delhi is repeating a playbook that has already yielded results. During the pandemic, production-linked subsidies successfully lured Apple to the country, with 25% of its iPhones now assembled locally. The new semiconductor programme builds on a $10 billion initiative launched in 2021 that covered half the cost of setting up chip projects.
That earlier effort successfully attracted Micron Technology and the Tata Group to western Gujarat state. Six semiconductor projects worth a combined $14.7 billion have been approved in the state, and India’s first domestic chip production has already begun there.
For European policymakers and investors, India's $19.7 billion commitment intensifies the global battle for semiconductor manufacturing capacity. It directly mirrors the $52 billion US CHIPS and Science Act, as well as the massive state-backed investment vehicles used by China. European capitals pushing their own semiconductor strategies now face a well-funded rival trying to pull the same engineering talent and foreign direct investment away from the continent, complicating Europe's efforts to build self-sufficiency.
India's push for technological autonomy extends across the entire supply chain, from raw silicon to consumer devices to sovereign AI. The need for independent infrastructure became more pressing this year after the US Anthropic export ban demonstrated the risks of depending on foreign technology. Nations worldwide are scrambling to secure domestic chip supplies to satisfy rising demand from artificial intelligence, vehicles, and consumer appliances. By bankrolling both the component and the final product, New Delhi is betting it can carve out a permanent role in the global tech supply chain.
