India's States Are Jousting in National Capital to Woo Semiconductor Projects

Over the past couple of days, the Semicon India 2025 conference in Delhi has made one thing clear: India’s states are locked in an intense contest to woo semiconductor projects with lavish subsidies and ready-to-use infrastructure. From land giveaways and tax breaks to power subsidies and water guarantees, state governments are offering a suite of incentives to attract investments in one of the world’s most resource-hungry industries.

At the annual conference, Prime Minister Narendra Modi said that 10 semiconductor projects worth over $18 billion are underway and the government is revamping the design-linked incentive scheme to tap the $1 trillion global chip market.

"The day is not far when the smallest chip made in India will drive the biggest change in the world," he said. "The day is not far when the world will say -- designed in India, made in India, trusted by the world."

And a bunch of India's states are seeing this goal as a large opportunity to tap.

At the event, officials from Gujarat, Uttar Pradesh, Odisha, Andhra Pradesh and Assam outlined how they are positioning themselves to host fabs, assembly units, and research hubs. Each state pitched its distinct advantages with regards to land parcels near airports, power rebates, or water supply commitments.

Uttar Pradesh has dedicated over 1,000 acres as a semiconductor-specific park, a designated zone with all ready-made infrastructure, said Anurag Yadav, Principal Secretary, IT&E, Go-Uttar Pradesh.

“In addition to physical infrastructure, we support investment through policy incentives such as capital subsidies and land subsidies. For example, there is a 75% subsidy on land costs, almost making it free, along with 100% exemptions on stamp duties and electricity duties,” he added.

In terms of power, according to Vishal Dev, Principal Secretary of E&IT, Government of Odisha, the state is power-surplus and offers some of the lowest industrial electricity rates in the country, ranging from Rs 4.85 to Rs 5.85 per unit.

“On top of that, we provide a reimbursement of Rs 2 per unit for 10 years to semiconductor and electronics industries, recognizing them as thrust sectors,” said Dev.

On the other hand, Andhra Pradesh, with its long-standing advantage of established tech hubs, is pursuing a semiconductor strategy focused on concentrated development rather than dispersing projects across the state.

“We have designated 5,000 acres within two hours of Chennai airport and another 5,000 acres within two hours of Bangalore airport, with all necessary infrastructure in place. Our goal is to develop the entire value chain of the semiconductor ecosystem, including R&D and supporting industries, rather than just large-scale factories,” said Bhaskar Katamneni, Secretary, ITE&C, Go-Andhra Pradesh.

A skilled workforce remains the most critical requirement for India’s growing semiconductor industry. Katamneni emphasized that his government is committed to developing this talent.

“We take responsibility for identifying, training, and supplying a skilled workforce by transforming local institutes and polytechnics to focus on the specific core technologies required,” he added.

Among Indian states, Gujarat already hosts a semiconductor fab facility in Dholera. Highlighting the strategic advantages of her state, P. Bharathi, Secretary of DST, Government of Gujarat, cited Gujarat’s strengths in logistics, utilities, and infrastructure.

Highlighting the importance of water for fab facilities, Bharathi noted that Dholera has 100 MLD of committed high-quality potable water. The existing water treatment plant currently handles 50 MLD and is being expanded to 150 MLD.

“Dholera is being developed with world-class infrastructure and social facilities, along with warehousing solutions for the semiconductor ecosystem, including semi-grade warehousing and benchmark common cleanroom facilities, suitable for fab units, tools, and testing units,” she added.

Officials from various Indian states discussed the strategies their states have adopted in implementing semiconductor projects during the panels at Semicon India 2025.