2 more chip packaging units to be operational by Dec: Ashwini Vaishnaw

Union IT Minister Ashwini Vaishnaw said India's semiconductor and AI infrastructure push is gathering pace with new chip packaging units and data centre investments

The third and fourth semiconductor chip packaging units, approved by the government under the ₹76,000 crore India Semiconductor Mission, should be operational by July and December, respectively, Union Electronics and Information Technology Minister Ashwini Vaishnaw said.

 

Speaking at the 2026 edition of the Confederation of Indian Industry Annual Business Summit, Vaishnaw said that, in addition to commercial production of chip packaging, the first domestic commercial production of micro light-emitting diode (LED) displays should begin within the next 22 months.

 

As prices of micro-LED display units keep coming down, there is an opportunity for India to take the lead since the display technology is at an inflexion point right now, he said.

   

The growth in artificial intelligence (AI) is happening at an unprecedented pace, as newer, higher-level technologies emerge every few weeks, Vaishnaw said.

 

“Every month, we need a new way of working coming out from some part of the world. And this is where we must be very clear in our approach that we have to be the beneficiaries of this (AI) technology by increasing our productivity in any sector that we work in,” he said.

 

To capitalise on the growth of AI, the government is focused on increasing India’s presence in the data centre sector, Vaishnaw said, adding that the 20-year tax break announced for setting up new data centres in the country was a “leap of faith” by the government.

 

The tax break measures have already started paying off, as investments close to $200 billion have been announced for the data centre sector so far, he said.

 

To strengthen India’s presence in the data centre economy, the government is also building new subsea cable networks that will connect large domestic data centres to other parts of the world, Vaishnaw said.

 

“One is from Vizag (Visakhapatnam) to Australia, and then on to the US (United States). The second is across the southern coast of India, connecting it to the Middle East and Europe, and landing on the East Coast of the US,” he said, adding that a third network around the Cape of Good Hope connecting India directly to the US was also in the works.

 

These subsea cables will provide India with a new digital infrastructure and become an important part of the country’s growth journey, he said.

 

“Our strategy is very clear on becoming the use-case capital of the world,” Vaishnaw said.

 

The government is also in touch with the domestic information technology and information technology-enabled services industry, which believes that AI-led job growth will be around 15-20 per cent per annum.

 

“Many other parts of the IT industry will have to be transformed now, but the AI-related job growth is happening. We have to be very careful in it,” he said.

 

India is also working with global companies such as Google to increase the production of AI servers in India, as the quality of these products is comparable to AI servers being manufactured in other parts of the world, Vaishnaw said.