People familiar with the matter said the fund would provide subsidies for chip design projects, manufacturing equipment, and supply chain development, said the Bloomberg.

The plan is still under discussion and could change.

New Delhi aims to develop chipmaking capabilities comparable with leading producers by 2032, Ashwini Vaishnaw, the technology minister, said in November.

India is reportedly doubling down on its semiconductor efforts by planning a new multi-billion-dollar fund to support the growth. Semiconductors are a crucial component that powers several electronic products, including smartphones, laptops, cars, defence systems, and AI servers.

The Indian government is planning to create a whopping $11 billion fund, which would be used to encourage companies and provide subsidies to build chip factories, develop semiconductor technology, and strengthen the local chip supply chain, according to a Bloomberg report. Although the plans are under discussion and are yet to be finalised.

The initiative builds on a 2021 US$10 billion incentive program that offered to cover half the cost of setting up semiconductor projects and drew companies such as Micron Technology and Foxconn, which have announced projects under the scheme.

Tata Group is also building a fabrication plant in Gujarat and a separate chip packaging unit, and several chip packaging and assembly projects have been announced.

The plan is smaller in scale than the US$52 billion CHIPS and Science Act and reflects wider global efforts to strengthen local chip supply chains.