India and the United States will jointly set up the world’s first multi-material chip fabrication unit in India, which will be exclusively for national security purposes.

During Prime Minister Narendra Modi's visit to the United States from 21-23 September 2024, a historic agreement was signed between him and American President Joe Biden on semiconductors.

Both the countries agreed to jointly set up a new semiconductor plant which will produce chips to be used in high-technology warfare platforms, like advanced communications, advanced sensing, and high voltage power electronics equipment.

With the establishment of the chip fabrication plant, India will become one of the few countries in the world to make such chips.

U.S.-India Initiative on Critical and Emerging Technology (iCET)

The landmark agreement between India and the United States on-chip fabrication is the result of the U.S.-India initiative on Critical and Emerging Technology (iCET).

In May 2022, during his official visit to the United States, Prime Minister Narendra Modi and Joe Biden announced the U.S.-India initiative on Critical and Emerging Technology (iCET) to promote cooperation in the field of strategic technology partnership and defence industrial cooperation between the governments, businesses, and academic institutions of the two countries.

Where will the Chip Fabrication Unit be set up?

The new fabrication unit, which will be called Shakti, will be set up in Jewar, Uttar Pradesh and it will be situated next to the under-construction Jewar International Airport.

Who will set up the Fabrication Unit?

The plant will be supported by the US Space Force, the Semiconductor Mission of the Indian government and the Indian chip manufacturing companies Bharat Semiconductors and 3ediTech.

The new chip fabrication unit will have both design and fabrication capabilities.

Features of the proposed Fabrication Unit in Jewar

The proposed fabrication unit will produce chips which will be used for military purposes
It will be used in space sensors, drones, night vision devices, missile seekers, fighter jets, electric vehicles, military communications, radars and jammers.
India and the United States could export the chips manufactured at the Jewar plants to friendly countries such as Quads and Asia-Pacific.

Benefits of the Fabrication Unit for India

The United States' decision to set up a high-level chip manufacturing plant in India focused on military needs reflects the close defence and strategic ties between the two countries.
India is a major importer of chips, and the new fabrication unit will save around Rs 6000 crore worth of imports annually.
It will be a boost to the Semiconductor Mission launched by the government of India to make India a chip manufacturing hub in the world.

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