The semiconductor conversation in India often feels like a distant skyline—gleaming, ambitious, and always a little far away. But in Mohali, at the Semi-Conductor Laboratory (SCL)—India’s lone operational chip fabrication plant—that skyline is beginning to move closer. A ₹4,500 crore modernization project has been awarded in three parts to two Indian firms (including a Tata Group company) and a global chip-equipment heavyweight, with one clear goal: help SCL step out of its aging comfort zone and start producing more relevant industrial chips for critical sectors like power and energy.
It’s a move that isn’t just about technology upgrades. It’s about control—over supply chains, over strategic capabilities, and over India’s ability to keep the lights on, meters running, and infrastructure secure without leaning too hard on imports.
The Three Winners, the Three Levers of Change
Think of the modernization as an overhaul of a factory that has been running on an older generation of tools. You don’t just replace one machine—you upgrade the whole rhythm of production: the core line, the specialized know-how, and the equipment ecosystem that makes everything work together.
1) Tata Semiconductor: Strengthening the Heart of the Fab
Tata Semiconductor Manufacturing Pvt. Ltd won the first bid package, focused on augmenting SCL Mohali’s existing 8-inch CMOS wafer fabrication line. Wafer size matters because it shapes output efficiency: larger wafers generally mean more chips per batch and better economics.
SCL’s 8-inch line is a reminder of an earlier era; modern high-volume fabs globally typically use 12-inch wafers to maximize manufacturing efficiency. While this project doesn’t magically turn SCL into a cutting-edge “bleeding node” facility overnight, it aims to make the existing backbone more capable and relevant for industrial needs.
2) Cyient Semiconductors: Bringing Specialized Industrial Tech to the Table
Cyient Semiconductors Pvt. Ltd won the second bid package, tasked with supplying patented technologies for:
- Radio-frequency integrated circuits (RF ICs)
- Chips supporting imaging
- Power-management devices
This is a telling choice. Industrial chips aren’t just about chasing the smallest nanometre number; they’re often about reliability, durability, and performance in harsh conditions—exactly the kinds of chips needed in energy systems, industrial automation, and critical infrastructure.
3) Applied Materials (Singapore): Modern Tools, Modern Software, Modern Line
The third package—modernization of fabrication equipment and software—went to Applied Materials’ Singapore subsidiary. Equipment and process tools are the nerve system of any fab. If the fab is a kitchen, these are the ovens, mixers, thermometers, and the recipes—combined with software that keeps everything calibrated, repeatable, and manufacturable at scale.
In other words: without modern equipment and toolchain software, even great chip designs and good intentions can’t become reliable silicon.
From 180nm to 28–65nm: Why This Jump Matters
Today, SCL is reported to produce 180-nanometre chips—older, but still useful for certain applications, especially where long-term reliability matters (space, defence, energy). The modernization could move SCL into the 28–65 nm range for “more modern industrial chips.”
That range is a sweet spot in global manufacturing for many non-consumer, high-reliability applications:
- Power and energy control systems
- Smart metering and grid modernization
- Industrial IoT and automation
- Imaging and sensor-adjacent workloads
- Power management and signal chains
These aren’t “latest smartphone” chips—and that’s the point. Industrial semiconductors are the quiet, stubborn workhorses. They don’t seek glamour; they seek uptime.
Cabinet Approval Pending—But the Timeline Is Already Being Whispered
The project still awaits formal approval from the Union cabinet before work begins. Yet, officials indicate modernization efforts may start “in a matter of weeks” once approval comes through. Industry voices suggest the upgraded plant could begin operating in its modern form within around two years after cabinet clearance.
That time horizon matters because semiconductor manufacturing doesn’t move at the speed of software. Tools must be installed, processes must be tuned, yields must be stabilized, and production must be proven. A fab doesn’t simply “upgrade”—it learns.
“Not Privatization”: Keeping SCL Public While Making It Useful
A key political and strategic note in the story is the Union IT minister Ashwini Vaishnaw’s reaffirmation that SCL’s modernization will not privatize the facility. Established in 1976 and operational since 1984, SCL remains a state-backed asset—and the only fab India currently has in operation.
That matters because fabs sit at the intersection of economics and national strategy. Even when private investment enters the ecosystem, a government-backed facility can serve public-interest roles: training, R&D bridging, strategic manufacturing, and support for emerging domestic design ecosystems.
A Fabrication Lifeline for Startups—and a Proposed National Chip Consortium
The modernization is also being positioned as a resource for India’s next wave of chip startups. Once upgraded, SCL Mohali is expected to serve as a key fabrication option for Indian startups—particularly those building for industrial and strategic domains.
Alongside this, Vaishnaw floated the idea of a consortium bringing together:
- C-DAC (Centre for Development of Advanced Computing)
- DRDO (Defence Research and Development Organisation)
- SCL
The implication is powerful: design capability plus defence-grade R&D plus domestic fabrication capacity—a triangle that could reduce dependence on external pipelines for certain categories of chips.
The Bigger Parallel: Tata’s Private Fab in Dholera
This project also lands at an interesting moment: Tata Electronics (the holding company of Tata Semiconductor Manufacturing Pvt. Ltd) is building India’s first private chip fab in Dholera, Gujarat.
So India’s semiconductor manufacturing story is starting to look like a two-track bet:
- Modernize and repurpose the existing state fab (SCL Mohali) for industrial and strategic relevance
- Build fresh private capacity to expand long-term domestic manufacturing capability
One reinforces the other: SCL can become a near-term platform for industrial chips and ecosystem enablement, while Dholera represents scale, future capacity, and private-sector manufacturing momentum.
Why Energy Chips Are the Real Headline
Among all the buzzwords—nodes, wafers, RF ICs—the most important phrase in the story might be “power and energy.”
Industry stakeholders emphasize that substituting foreign chip imports is most critical in sectors like power and energy because these systems are foundational. If chips become hard to import, delayed, restricted, or geopolitically sensitive, the downstream effects are enormous: smart meters stall, grid upgrades slow, maintenance cycles break, and strategic autonomy weakens.
This is why the modernization is framed as a sovereignty step. Not in a symbolic way, but in a practical one: build the ability to manufacture the chips you cannot afford to be without.
Takeaways: What This Modernization Could Mean for India
- SCL Mohali is being repositioned, not reinvented—toward industrial chips that are immediately useful and strategically important.
- The project structure is deliberate: strengthen the fab line (Tata Semiconductor), add specialized industrial tech (Cyient), and modernize equipment/software (Applied Materials).
- Moving from 180nm to 28–65nm could dramatically expand relevance for energy, power management, imaging, and RF-related industrial uses.
- Keeping SCL public while making it startup-accessible could help build domestic capability beyond just manufacturing—into design-to-silicon pathways.
- In parallel, private capacity in Dholera signals India is building both continuity and scale.
If cabinet approval clears the final gate, Mohali’s fab won’t just be upgraded—it may become something India hasn’t quite had before: a domestic silicon workbench for critical infrastructure, and a proving ground for industrial-grade independence.
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