Tata Electronics is expanding its footprint in the semiconductor industry with the construction of two additional fabrication plants, or fabs, in Dholera, Gujarat, according to a report by Mint. This move is part of the company’s larger strategy to build a robust domestic chip manufacturing ecosystem that meets growing global demand, establishing Tata as a key player in the international semiconductor market.
Tata’s First Semiconductor Fab to Begin Operations in 2026
Construction of Tata’s first semiconductor fab is already underway at the Dholera Special Investment Region, with foundation work starting in March this year. This facility will focus on producing chips for various applications, including power management circuits, display drivers, microcontrollers, and high-performance computing logic. These chips will be critical for industries such as automotive, data storage, wireless communication, and artificial intelligence (AI). At full capacity, the fab is expected to produce up to 50,000 wafers per month.
The first phase of this project, valued at INR 91,000 crore, is being developed in collaboration with Taiwan’s Powerchip Semiconductor Manufacturing Corporation (PSMC). The fab is expected to begin production by 2026.
Tata Electronics’ Plans for Second and Third Chipmaking Units
The second and third fabs will be built on a similar scale, with construction expected to begin over the next five to seven years. However, it remains unclear whether Tata Electronics will continue its partnership with PSMC for these future fabs. The decision on partnerships, as well as the technological and infrastructure specifications for these projects, will depend on the needs of the global semiconductor market at that time.
Certain infrastructure elements will be shared across all three fabs, with some already being constructed as part of the first phase. This shared approach is expected to reduce costs for the second and third phases, although the overall investment will remain significant, according to a senior executive involved in the project.
Tata Electronics is also in talks with several potential buyers for the chips that will be produced at the Dholera facility. Initial customers are expected to include Tata Group companies such as Tata Motors, Tata Play, and Tata Teleservices, all of which are significant consumers of integrated circuits. Additionally, the company is working on building a strong local supply chain by partnering with suppliers and establishing ancillary units.
A residential complex to house approximately 4,000-5,000 workers who will be employed at the Dholera fab is also under construction.
Tata Electronics’ Assam Chip Factory
Tata’s expansion into semiconductor manufacturing isn’t limited to Gujarat. The company is also advancing work on a Rs 27,000 crore assembly and testing unit in Jagiroad, Assam. Work on the 600-acre site began last month, with environmental assessments, flood risk analysis, and other preliminary studies completed. The Assam facility, scheduled to begin high-volume production by mid-2025, will produce up to 48 million chips daily.
This factory will focus on three core technologies: wire bond, flip chip, and Integrated Systems Packaging (ISP), with plans to explore more advanced packaging solutions in the future.
