India pledges $20 billion to boost chips and smartphones as Modi pushes for an Indian mobile brand

India pledged 1.9 trillion rupees ($19.7 billion) in combined incentives for domestic chip and smartphone production on Wednesday. The cabinet approved 1.28 trillion rupees ($13.3 billion) for semiconductors, covering chip design, machine fabrication, research and development, and talent creation, and a separate 625 billion rupees ($6.5 billion) for mobile phone manufacturing. “The Prime Minister has given us clear guidance that we must create an Indian mobile brand,” Technology Minister Ashwini Vaishnaw told reporters in New Delhi.

The new programme builds on India’s $10 billion 2021 initiative, which offered to cover half the cost of setting up semiconductor projects. That effort drew Micron Technology and the Tata Group to western Gujarat state. India’s first chip production has already begun in Gujarat, and six semiconductor projects worth a combined $14.7 billion have been approved in the state.

India’s push mirrors the $52 billion US CHIPS and Science Act that funds domestic chip capacity, though India’s programme is at an earlier stage with only a handful of major projects underway. Governments worldwide are racing to build self-sufficient chip industries to meet rising demand from AI, smartphones, cars, and appliances. China funds its chip industry through giant state-backed investment vehicles.

India is trying to attract major chipmakers with its engineering talent, design capabilities, and subsidies, following the same playbook it used to bring Apple’s iPhone assembly into the country. Apple now assembles 25% of its iPhones in India, thanks to production-linked subsidies offered during the pandemic. The smartphone subsidies will also support mobile production by Indian companies in a market dominated by Chinese brands. India’s broader push for technological self-reliance has intensified this year after the US Anthropic export ban demonstrated the risks of depending on foreign infrastructure. The combined $20 billion puts money behind a strategy that extends from raw silicon to consumer devices to sovereign AI.