India’s push to become a key player in semiconductor manufacturing is drawing global investment at a large scale, but at the same time it is also exposing the country to new cybersecurity, geopolitical and supply-chain risks, Union Electronics and Information Technology Minister Ashwini Vaishnaw has warned.

In an interview with news agency PTI, Vaishnaw said India must remain alert as it develops the ability to design and manufacture chips. He said the country’s growing role in the global semiconductor value chain could create geopolitical risks, particularly as more international companies begin treating India as a trusted manufacturing and technology partner.

“We have to continuously be watchful of the potential geopolitical risks which will arise because India is now emerging as a country which can design and manufacture chips,” Vaishnaw said. “Obviously, that will be seen as a threat by many other established players.”

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He said he had spoken candidly to semiconductor companies and deep-tech startups about the risks facing the sector, urging them to strengthen cybersecurity systems and prepare for disruptions that could affect manufacturing, research, supply chains and critical infrastructure.

“I have very candidly told the entire industry: be prepared for cyberattacks, be prepared for any other kinds of threats and be prepared for any kind of disruption that might get created by countries that don’t like India to come up in the semiconductor value chain,” he said.

Industry must anticipate and prepare: IESA

Ashok Chandak, President of India Electronics and Semiconductor Association (IESA) and SEMI India, spoke to The Financial Express Digital and said that India’s semiconductor expansion will bring new exposure to geopolitical tensions, cyberattacks, supply-chain disruptions and dependence on a small number of global suppliers.

“These risks cannot be eliminated entirely because semiconductor manufacturing is globally interconnected,” Chandak said. “The answer is not to avoid these risks, but to anticipate them, prepare for them and build the capability to deal with disruptions when they occur.”

He added that the priority should be to identify vulnerabilities early, prepare for disruptions and ensure that no single failure can seriously damage India’s semiconductor plans.

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Global supply chains create vulnerabilities

Semiconductor manufacturing depends on a highly interconnected global network. Chip companies require specialised equipment, electronic design automation (EDA) tools, intellectual property (IP), advanced materials, wafers, fabrication facilities, packaging and testing services sourced from several countries.

This dependence can create vulnerabilities when critical technologies or supplies are controlled by a limited number of countries or companies. Export restrictions, delayed shipments, sharp price increases or limits on technology access could affect project schedules and disrupt industries that rely on semiconductors.

Ashok Chandak said India should adopt an “anticipate and deal” approach as it moves from creating initial manufacturing capacity to building a broader semiconductor ecosystem.

How can central government secure the supply chain?

India must avoid excessive dependence on any one country, company or technology source for critical equipment, chemicals, materials, software and semiconductor IP, Chandak said.

“This means diversifying suppliers, qualifying alternative sources and developing contingency plans before a disruption takes place,” he said.

Companies and policymakers should identify critical inputs, assess the availability of substitutes and maintain suitable inventory or strategic buffers for items that cannot be sourced quickly. Alternative suppliers should also be tested and approved in advance rather than searched for only after a crisis begins.

“India should also build deeper partnerships with multiple trusted countries and global companies. Such partnerships can provide access to technology and supplies while reducing the risk of dependence on a single external source,” he added.

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Building domestic capabilities where it makes sense

SEMI India President also mentioned that India should accelerate domestic capabilities in areas where it is economically and technologically viable. These include semiconductor equipment, specialised materials, speciality chemicals, Electronic Design Automation (EDA) tools, chip IP, packaging technologies and manufacturing processes.

Domestic capability does not mean producing every component locally, Chandak said. Instead, India should focus on reducing dependence in areas that are strategically important or difficult to replace during a crisis.

“India does not need to eliminate every external dependency,” he added. “It needs to ensure that no single dependency or disruption can disproportionately impact the semiconductor mission.”

He also called for stronger industry-sponsored research, closer collaboration between companies and universities, and greater investment in Indian IP, process technologies, manufacturing know-how and chip products.

Continuous risk monitoring needed

Geopolitical, technology, cyber and supply-chain risks can change quickly. Chandak said India should establish mechanisms to continuously monitor vulnerabilities across critical parts of the semiconductor ecosystem. Such monitoring could track export-control decisions, supplier concentration, technology restrictions, cyber incidents, logistics disruptions and the financial health of key suppliers.

A central risk-monitoring system could help government and industry identify potential problems earlier and coordinate responses before they affect production.

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Cybersecurity must protect factories

As fabs, OSAT and ATMP facilities, design centres and manufacturing systems become more digital and interconnected, cybersecurity must be treated as a critical infrastructure issue rather than only an IT responsibility.

A cyberattack could disrupt production, steal chip designs, compromise manufacturing equipment, damage product quality or expose sensitive information. Because semiconductor factories depend on several layers of connected equipment and third-party systems, an attack on a supplier or service provider could also affect the main facility. SEMI’s cybersecurity standards address risks associated with manufacturing equipment and its integration into factories.

  • SEMI E187 sets baseline cybersecurity requirements for fab equipment, including operating systems, network security, endpoint protection and monitoring.
  • SEMI E188 focuses on preventing malware from entering a factory during equipment delivery, installation, maintenance or servicing.
  • SEMI E191 sets out requirements for reporting the cybersecurity status of computing devices connected to factory networks.

Measurable security standards

Chandak said India should establish measurable cybersecurity benchmarks based on standards such as ISO/IEC 27001, IEC 62443, the NIST Cybersecurity Framework and relevant CERT-In requirements.

Possible requirements could include:

  • Complete inventory and risk classification of all critical IT and operational-technology assets.
  • Continuous monitoring of critical manufacturing networks.
  • Quarterly vulnerability assessments and periodic penetration testing.
  • Annual independent cybersecurity audits for critical facilities.
  • At least two cyber-resilience drills every year, including ransomware, supply-chain compromise and manufacturing-disruption scenarios.
  • Clear timelines for detecting, reporting, containing and recovering from incidents.
  • Regular testing of backups and recovery systems.
  • Multi-factor authentication, privileged-access controls, encryption and data-loss prevention for critical systems and semiconductor IP.
  • Cybersecurity assessments of third-party equipment, software, firmware, EDA tools and service providers.

The objective should be continuous resilience rather than one-time compliance. Companies should measure vulnerability-closure rates, audit findings, incident-detection time, recovery time and the performance of cyber drills.

Supply-chain attacks can enter through equipment

Semiconductor facilities are exposed not only through their own networks but also through the tools and software supplied by equipment manufacturers and service providers. An infected tool, compromised firmware, unsafe portable media or an outdated operating system could provide an entry point into the factory. Industry cybersecurity guidance identifies two major areas of risk: the delivery and integration of an infected tool, and older equipment that becomes vulnerable over time.

This makes supplier security a critical part of factory protection. Equipment and software providers should disclose security information, support patching, restrict unnecessary ports and provide clear logs of access and maintenance activity.

Japan’s Ministry of Economy, Trade and Industry has also highlighted the risk of cyberattacks disrupting factory operations and leaking confidential development information. Its semiconductor-factory guidelines are designed to address advanced threats, including attacks associated with nation-state groups, and align with SEMI E187 and E188 and NIST’s cybersecurity framework.

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IESA to support industry preparedness

Chandak said IESA plans to work with industry associations and specialist organisations, including SEMI and the Data Security Council of India, to strengthen cybersecurity and critical-infrastructure protection across the semiconductor and electronics sectors.

IESA will work with SEMI to draw on global industry experience, standards and best practices and adapt them to India’s requirements. The collaboration could include industry guidance, cybersecurity benchmarks, training programmes, awareness initiatives, cyber-resilience exercises and information-sharing mechanisms.

Sharing information about vulnerabilities and attacks is particularly important for an industry in which a weakness at one supplier can affect several manufacturers. Industry-wide coordination can help companies respond faster and prevent the same vulnerability from spreading across the ecosystem.

Preparedness must become strategic capability

India’s semiconductor mission will require international partnerships, but it must also avoid excessive concentration in suppliers, technologies and markets. The country’s strategy should therefore combine domestic capability-building with supplier diversification, trusted partnerships, strategic buffers, continuous risk monitoring and strong cybersecurity standards.

“Preparedness itself must become a strategic capability: anticipate, prepare, diversify and respond,” Chandak said.

For India, the goal is not complete self-sufficiency. It is a resilient semiconductor ecosystem capable of absorbing a cyberattack, export restriction, supplier failure or geopolitical disruption without bringing the country’s chip ambitions to a halt.

India seeks a broader chip ecosystem

India is trying to expand beyond chip assembly, testing and packaging. Its larger goal is to build capabilities in chip design, fabrication, semiconductor equipment, materials, research and development, and talent development.

The Union Cabinet approved the second phase of the semiconductor programme, known as Semicon 2.0, in July 2026 with an outlay of Rs 1,27,500 crore. The programme is intended to support a wider range of activities across the semiconductor value chain.

The first phase resulted in the approval of 12 semiconductor projects involving investments of more than Rs 1.64 lakh crore. Five of these projects, including facilities associated with Micron, Kaynes and CG Semi, have already started commercial production, according to the government.

The government has also said that it received investment commitments of about Rs 1 lakh crore under the second phase of the semiconductor scheme.

Recent announcements have underlined the scale of investor interest. Applied Materials has announced plans to invest $5 billion in India through 2035. Lam Research has proposed an investment of Rs 10,000 crore, while Tata Electronics is developing a 363-acre vendor park at Dholera. Fujifilm has announced plans for an Rs 800-crore semiconductor materials plant.

Chips for cars, power systems and appliances

Meanwhile, Vaishnaw also said that India’s semiconductor capabilities should eventually serve a wide range of products used in everyday life. Over the next five years, he said, the country should be able to design and manufacture more chips for automobiles, power systems, televisions, refrigerators and other appliances.

“There are many chips which go in automobiles, in cars, scooters and motorcycles, that are manufactured in our country. We should be able to have many of those chips designed and manufactured in India,” he said.

The automobile industry uses semiconductors for engine control, safety systems, driver-assistance features, infotainment, battery management and power management. Greater domestic capability in these areas could help reduce dependence on imported components and make supply chains more resilient.

Vaishnaw also identified the power sector as an important area for domestic chip development. Chips used in transmission lines, transformers, converters and other power equipment will be part of the country’s broader semiconductor strategy.

“There are many chips which go into the power sector, for example, the transmission lines, the transformers and the converters,” he said. “We should be able to manufacture many of those chips, which are designed and made in India.”

Focus on consumer electronics

The government also wants more chips used in televisions, refrigerators and household appliances to be designed and manufactured in India. Vaishnaw compared semiconductors to the core operating systems of modern electronic products. Consumers may notice the finished television or refrigerator, he said, but the chip controls much of the product’s functionality.

“When we buy a TV, we don’t see the chip inside it, but it is the chip which is driving the entire thing,” he said. He pointed to a display-control module plant being developed in Uttar Pradesh as an example of the type of manufacturing capability India wants to establish. The module controls the way a television processes and displays an image.

“The display control module is the one which controls how the TV displays the final picture; that is the heart and the brain of the television. So, that is going to be manufactured in India,” Ashwini Vaishnaw said.

Source: AI image

Investment in display technology

Vaishnaw also referred to Crystal Matrix’s planned LED display fabrication facility. He said the company had moved from a 90-micron process to a more complex 40-micron level and was setting up a research and development facility in India.

The project is expected to support domestic manufacturing and design of large LED screens. Such investments could help India develop expertise in display technologies alongside its efforts in conventional semiconductor manufacturing.

“All those large screens, LED screens, will be manufactured and designed in India,” Vaishnaw said.

Security will be central to growth

India’s semiconductor strategy is expanding at a time when chip technology has become closely linked to economic security, defence, telecommunications, automobiles, energy systems and artificial intelligence. As India attracts more global investment and becomes part of international chip supply chains, companies will need to protect not only factories but also design databases, manufacturing systems, intellectual property and supplier networks.

Vaishnaw’s warning also indicates that cybersecurity and geopolitical preparedness will be treated as essential parts of India’s semiconductor expansion. The country’s ability to become a reliable chip-manufacturing hub will depend not only on investment and technology but also on its capacity to withstand cyberattacks and disruptions.