India Gears Up for Landmark Shift in Semiconductor and AI Strategies

India is intensifying efforts to bolster its semiconductor production and evolving AI strategies. With initiatives like the National Critical Minerals Mission and new incentive schemes, the country aims to stabilize its supply chains. Focused on AI accessibility, India charts a developmental path distinct from global giants.

India's semiconductor strategy is entering a pivotal phase, addressing global supply chain disruptions with ambitious domestic manufacturing efforts, says Konark Bhandari, a Carnegie Endowment Fellow, during the Carnegie Global Technology Summit Innovation Dialogue 2025.

China's export restrictions on critical materials have destabilized chipmaker supplies. In response, India launched the National Critical Minerals Mission and a Production Linked Incentive scheme worth Rs 7,280 crore for rare earth magnets, according to Bhandari.

The first phase of the India Semiconductor Mission (ISM 1.0), initiated in 2021 with a Rs 76,000 crore investment, has been fully allocated, resulting in significant commitments from firms like Micron and Tata.

As semiconductor supply chains remain intricate, merely attracting a single anchor firm won't suffice. The anticipated ISM 2.0 is set to extend incentives to other supplier segments, though policy details are pending, Bhandari added.

India is aiming for a unique AI developmental model, distinct from the US and China's commercial and state-driven approaches. Prioritizing AI compute access for low-income households and constrained enterprises, Bhandari highlighted India's significant role in the forthcoming AI Impact Summit 2026.

However, challenges in data governance loom. As Bhandari notes, the international use of Indian user data for training foreign AI models is emerging as a significant policy discussion.

The Carnegie India-hosted Global Technology Summit Innovation Dialogue in New Delhi is a precursor to the AI Impact Summit 2026, scheduled for February 2026. (ANI)

(With inputs from agencies.)