India woos U.S. chip giants as it looks to become a semiconductor superpower
Indian Prime Minister Narendra Modi has looked to woo American semiconductor firms to invest in his country.
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Chief executives of some of the U.S.’s top semiconductor firms poured praise on India’s technology sector at an event on Friday attended by Prime Minister Narendra Modi as the world’s fifth-largest economy looks to position itself as a global chip powerhouse.
The CEOs of Micron and Cadence and senior executives at Applied Materials and AMD were on stage at SemiconIndia alongside Modi, speaking about their investments in India’s chip market. Ajit Manocha, the CEO of U.S.-based industry body SEMI, was also in attendance.
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“For the first time in India’s history, geopolitics, domestic policies and private sector capacity are aligned in India’s favor to become a player in semiconductor production,” Manocha said during a keynote speech.
“We will look back in the year 2023 … as a milestone year in which things began to take shape.”
The event with some of the world’s biggest chip firms highlights India’s ambitions to become a major hub for semiconductors alongside the likes of the U.S., Taiwan and South Korea.
India’s chip strategy
India’s chip strategy consists of two major parts. The first is luring in foreign firms to set up operations and invest in the country while the second is on forming alliances with other key semiconductor nations like the U.S.
New Delhi has introduced supportive policies for the semiconductor sector. In December, the government greenlit a $10 billion incentive plan for the semiconductor industry. This is open to foreign firms too.
And last month, Modi visited the U.S. where he said India would work with America on semiconductors and other areas.
At SemiconIndia, the American chip firms in attendance spoke about their investments in India and announced new ones, highlighting India’s focus on attracting foreign companies.
AMD said it plans to invest around $400 million in India over the next five years. This includes a new campus in Bangalore that will be the company’s largest design center.
“India teams will be pivotal in advancing AI machine learning and both hardware and software capabilities,” Mark Papermaster, CTO of AMD, said during a keynote speech on Friday.
Last month, Micron announced plans to set up a semiconductor assembly and testing facility in the state of Gujarat in India. Micron’s investment will total up to $825 million.
“We are hopeful that this investment will help catalyze other investments in the sector, strengthen indigenous manufacturing capability, encourage innovation and support broader job creation,” Sanjay Mehrotra, CEO of Micron, said on Friday.
India’s IT minister Ashwini Vaishnaw said Friday that construction on this plant would start “soon.”
Foxconn’s India setback
One other notable attendee was Young Liu, chairman of Foxconn, which is the Taiwanese company that assembles Apple’s iPhones. Over the past couple years, Foxconn has made a push into semiconductors.
It’s biggest effort came last year when Foxconn agreed with Indian metals-to-oil conglomerate Vedanta to set up a semiconductor and display production plant in India as part of a $19.5 billion joint venture. However, Foxconn pulled out of the venture this month, dealing a blow to both the company and India’s ambitions.
Still, it hasn’t seemed to deter both companies. Liu’s presence at the event signals Foxconn’s ambition to invest in India. Liu told CNBC-TV18 on Friday that Foxconn is looking to invest $2 billion in India over the next five years.
Vedanta Group Chair Anil Agarwal said on Friday at SemiconIndia that the company has “identified world class partners for technology and are in the process of tying up with them” in semiconductors.
India’s challenges
The high-profile event with all the CEOs masks some of India’s challenges in the semiconductor industry.
One area that India could be attractive in is the packaging and testing of semiconductors, according to Pranay Kotasthane, deputy director of the Takshashila Institution. This requires relatively low-skilled labor but high capital investment, which India could have. Yet no major Taiwanese firm in this segment of the market as set up shop in India.
“The lack of policy consistency and high import tariffs are the bottlenecks that can explain why Taiwanese companies haven’t moved ahead,” Kotasthane said.
Meanwhile, in the area of foundries, companies that actually manufacture semiconductors, there haven’t been good technology partners for those trying to set up shop in India. The chip manufacturing tie-up between Vedanta and Foxconn reportedly relied on technology from European semiconductor firm STMicroelectronics.
“None of the fab proposals have yet been able to find good technology partners,” Kotasthane said.
Still, analysts have pointed toward India’s huge domestic market and other factors such as incentives as reasons for optimism on the country’s chip market.
On Friday, Modi touted India’s credentials.
“Skilled engineers and designers are our strength. Anyone who wants to be a part of the world’s most vibrant and unified market has faith in India,” the Indian prime minister said.
Technology
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OpenAI CEO Sam Altman speaks during the Snowflake Summit in San Francisco on June 2, 2025.
Justin Sullivan | Getty Images News | Getty Images
OpenAI has been awarded a $200 million contract to provide the U.S. Defense Department with artificial intelligence tools.
The department announced the one-year contract on Monday, months after OpenAI said it would collaborate with defense technology startup Anduril to deploy advanced AI systems for “national security missions.”
“Under this award, the performer will develop prototype frontier AI capabilities to address critical national security challenges in both warfighting and enterprise domains,” the Defense Department said. It’s the first contract with OpenAI listed on the Department of Defense’s website.
Anduril received a $100 million defense contract in December. Weeks earlier, OpenAI rival Anthropic said it would work with Palantir and Amazon to supply its AI models to U.S. defense and intelligence agencies.
Sam Altman, OpenAI’s co-founder and CEO, said in a discussion with OpenAI board member and former National Security Agency leader Paul Nakasone at a Vanderbilt University event in April that “we have to and are proud to and really want to engage in national security areas.”
OpenAI did not immediately respond to a request for comment.
The Defense Department specified that the contract is with OpenAI Public Sector LLC, and that the work will mostly occur in the National Capital Region, which encompasses Washington, D.C., and several nearby counties in Maryland and Virginia.
Meanwhile, OpenAI is working to build additional computing power in the U.S. In January, Altman appeared alongside President Donald Trump at the White House to announce the $500 billion Stargate project to build AI infrastructure in the U.S.
The new contract will represent a small portion of revenue at OpenAI, which is generating over $10 billion in annualized sales. In March, the company announced a $40 billion financing round at a $300 billion valuation.
In April, Microsoft, which supplies cloud infrastructure to OpenAI, said the U.S. Defense Information Systems Agency has authorized the use of the Azure OpenAI service with secret classified information.
A United Launch Alliance Atlas V rocket is shown on its launch pad carrying Amazon’s Project Kuiper internet network satellites as the vehicle is prepared for launch at the Cape Canaveral Space Force Station in Cape Canaveral, Florida, U.S., April 28, 2025.
Steve Nesius | Reuters
United Launch Alliance on Monday was forced to delay the second flight carrying a batch of Amazon‘s Project Kuiper internet satellites because of a problem with the rocket booster.
With roughly 30 minutes left in the countdown, ULA announced it was scrubbing the launch due to an issue with “an elevated purge temperature” within its Atlas V rocket’s booster engine. The company said it will provide a new launch date at a later point.
“Possible issue with a GN2 purge line that cannot be resolved inside the count,” ULA CEO Tory Bruno said in a post on Bluesky. “We will need to stand down for today. We’ll sort it and be back.”
The launch from Florida’s Space Coast had been set for last Friday, but was rescheduled to Monday at 1:25 p.m. ET due to inclement weather.
Amazon in April successfully sent up 27 Kuiper internet satellites into low Earth orbit, a region of space that’s within 1,200 miles of the Earth’s surface. The second voyage will send “another 27 satellites into orbit, bringing our total constellation size to 54 satellites,” Amazon said in a blog post.
Kuiper is the latest entrant in the burgeoning satellite internet industry, which aims to beam high-speed internet to the ground from orbit. The industry is currently dominated by Elon Musk’s Space X, which operates Starlink. Other competitors include SoftBank-backed OneWeb and Viasat.
Amazon is targeting a constellation of more than 3,000 satellites. The company has to meet a Federal Communications Commission deadline to launch half of its total constellation, or 1,618 satellites, by July 2026.
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