Record global chip equipment spending offers major boost to India's semiconductor ambitions: SEMI
New Delhi, July 14
Global spending on semiconductor manufacturing equipment is set to hit a record USD 165.9 billion in 2026, marking a 23.2 per cent increase over the previous year, according to SEMI's Mid-Year Total Semiconductor Equipment Forecast. The sustained surge in investments, driven by artificial intelligence and advanced chip technologies, is expected to create significant opportunities for India's rapidly expanding semiconductor ecosystem.
According to the forecast, global semiconductor equipment spending will continue its upward trajectory to reach USD 229.5 billion by 2028, marking five consecutive years of industry growth. Investments are being fuelled by rising demand for AI-enabled computing, high-bandwidth memory (HBM), advanced logic chips, next-generation packaging technologies and intelligent edge devices.
The report said Wafer Fab Equipment (WFE), the industry's largest segment, is expected to reach USD 143.9 billion in 2026, while semiconductor test equipment spending is projected to grow 31 per cent to USD 15.3 billion as manufacturers expand production capacity.
SEMI President and CEO Ajit Manocha said AI is accelerating demand for more powerful and efficient chips, prompting semiconductor companies to increase investments in leading-edge logic, advanced memory, testing and packaging capabilities.
The global investment cycle comes at a crucial time for India, which has approved 12 semiconductor manufacturing projects across fabrication plants, ATMP/OSAT facilities, compound semiconductors and display manufacturing, representing investments of more than USD 20 billion. Government initiatives, including the Semicon India Programme, Production Linked Incentive (PLI) scheme, Electronics Components Manufacturing Scheme (ECMS), Electronics Manufacturing Clusters (EMC), Research, Development and Innovation (RDI) initiatives and the India AI Mission, are helping build a comprehensive semiconductor ecosystem.
Ashok Chandak, President of SEMI India, said the rapid growth in global semiconductor equipment investments aligns with India's national semiconductor mission and presents an opportunity to strengthen domestic manufacturing, develop local supply chains, foster innovation and generate high-value employment.
He added that India's ongoing investments in fabs, OSAT facilities and display manufacturing, along with a growing ecosystem for semiconductor equipment, materials and components, are making the country an increasingly attractive destination for global investments.
The report also noted that while China, Taiwan and South Korea are expected to remain the world's largest destinations for semiconductor equipment spending through 2028, regional diversification, government incentives and supply chain resilience efforts are creating fresh opportunities for emerging manufacturing hubs such as India. It added that rising global demand is expected to benefit equipment manufacturers, automation firms, precision engineering companies, speciality material suppliers and component makers looking to expand their presence in the country.
— ANI
Reader Comments
AI and chip demand are booming globally, but I'm cautiously optimistic about India's share. We've seen many announcements—Foxconn, Vedanta, Micron—but actual production on the ground is still slow. The government needs to fast-track clearances and ensure water and power supply for these fabs. Hope SEMI's optimism translates into real jobs for our engineers.
As someone working in semiconductor design in Bangalore, this is encouraging. The global spending surge means more opportunities for Indian R&D centres and equipment suppliers. But the article rightly mentions China, Taiwan, and South Korea as dominant players. India needs to focus on niche areas like chip packaging and testing where we can compete faster. Good timing for the India AI Mission too! 👍
I just hope this isn't another case of 'announcement bhi bahut, execution bhi bahut' (lots of announcements, lots of empty promises). The PLI scheme has had mixed results in electronics. For semiconductors, the supply chain and ecosystem are far more complex. Also, where is the talent pool? IITs produce great chip designers, but we need thousands of technicians for fabs. Let's also focus on vocational training partnerships with global companies.
India is definitely an attractive destination now, but we need to be realistic. The global semiconductor supply chain is dominated by a few players—TSMC, Samsung, Intel. India's $20 billion investment sounds big, but it's a drop in the ocean compared to the $165.9 billion global spending. The opportunity is in equipment manufacturing and specialised materials—areas where Indian SMEs can excel if given the right policy support. Cheers to progress! 🥂
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