India has the potential to become a significant player in the global semiconductor supply chain, but investments must be guided by demand, financial viability and the ability to execute projects, Tata Sons Chairman N Chandrasekaran said on Tuesday.Chandrasekaran said that semiconductors would be fundamental to the country’s future and meeting its domestic consumption requirements. He added that India’s talent pool, the size of its domestic market and its potential to participate in international supply chains put it in a favourable position.“We are in a beautiful spot in India, because we have the talent, we have the domestic market, we can play a part in every global supply chain,” he said at the 2026 Bloomberg New Economy Forum.Chandrasekaran also highlighted collaboration with global players as a necessity to build the country’s semiconductor ecosystem. Access to technology and the availability of energy would also be important considerations as India develops its manufacturing capabilities.“We need partnerships, because we have all the technologies … But if you design it, definitely we will get there. But you also have to be careful, because you need to keep an eye on energy,” he said.Tata Electronics is setting up a fabrication plant in Dholera, Gujarat, with Taiwan’s Powerchip Semiconductor Manufacturing Corporation (PSMC) as its partner. The project involves an investment of around Rs 91,000 crore and will manufacture chips for automobiles, mobile devices, consumer electronics, artificial intelligence and other industrial applications. Alongside, the group is developing a semiconductor assembly and test facility in Assam at an investment of around Rs 27,000 crore.The projects are intended to cater to rising domestic demand, reinforce India’s semiconductor supply chain and strengthen the country’s integration with the global electronics manufacturing ecosystem.
‘We need to also see where the demand is’
Chandrasekaran cautioned that India and businesses should not rush into manufacturing the most advanced chips without first determining whether there was sufficient demand to justify the investment.“You cannot be reckless and say that I am going to be putting a 2 nanometre chip (plant). It’s just not going to work. So, we need to also see where the demand is,” he said.He emphasised that financial viability was a key consideration not only for businesses but also for India and its people. Investments, he said, needed to make commercial sense and support sustainable employment over the long term.“And the financially viable thing, you have got to see the sun cross the river,” said Chandrasekaran, who was recently given a third five-year term as Tata Sons Chairman amid a boardroom tussle over the group’s future.His comments come as the group pursues semiconductor investments while weighing the practical considerations involved in developing the sector. Although the long-term need for semiconductor capabilities is clear, decisions on the scale of investment, the pace of expansion and the technologies to be used remain important considerations.Chandrasekaran acknowledged that businesses operating in the global environment could not expect every aspect of an investment to be predictable. However, he said some fundamental factors remained certain, including energy requirements and the ability to execute projects.“But a lot of things are certain. Energy is certain, the game is certain, the ability to execute is certain. And the only thing is how much you ramp up, how fast you ramp up, which technology you go to…,” he said.
