Semiconductors serve as the fundamental control centres of the modern digital ecosystem, acting as both the “brain” and “beating heart” of electronic systems. Semiconductors or chips are electronic devices with millions or billions of transistors that process data and manage electric currents. In practice, manufacturers process semiconductor materials such as silicon and other materials into tiny, highly engineered chips that power and control most of the electrical devices today. As oil powered factories and transportation in the 20th century, semiconductors now power data, intelligence, and digital infrastructure — earning their place as the new oil of the 21st century.
Semiconductors are embedded in everything from satellites and smartphones to advanced medical equipment and electric vehicles, making them indispensable to both civilian life and national security. As global reliance on digital technologies deepens, access to a stable supply of chips has become a strategic priority rather than merely an industrial concern. The sector remains heavily concentrated in a few key regions — particularly Taiwan, South Korea, China, Japan, and the United States — creating significant global interdependence and vulnerability to disruptions.
India, too, has entered the race, by launching ambitious semiconductor incentive schemes and partnering with global firms to establish fabrication and assembly plants. India is currently highly dependent on semiconductor imports for almost all chips it uses. According to several sources, India imports around 95% of its semiconductors from countries like China, Taiwan, South Korea, and Singapore. This has highlighted the need for India to strengthen its domestic semiconductor industry.