Shruti Mittal and Konark Bhandari
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At Semicon India 2025, the India Semiconductor Mission’s (ISM) annual flagship conference, Prime Minister Narendra Modi unveiled the first “made-in-India” chip, the Vikram 32 microprocessor. The chip was jointly developed by the Semiconductor Laboratory (SCL) at Mohali, in collaboration with the Indian Space Research Organization (ISRO) for use in the operation of space launch vehicles. Amid uncertainty about whether this was India’s first “manufactured” chip or the first packaged chip made in India, the news came at a time when the SCL was looking to upgrade its production facilities. Accordingly, this article looks at the progress of the SCL fab modernization plan based on publicly available documents, and potential learnings for future upgrades to government-owned fabs and for India’s larger semiconductor ecosystem, especially regarding the use of refurbished equipment.
Background
The plan to upgrade the SCL was first announced in 2022. The SCL is currently the only integrated device manufacturer (IDM) semiconductor facility in India, meaning it operates everything from assembly, testing, and packaging (ATP) and design labs to foundries. It has long served India’s space program and its chips have even powered ISRO’s Mars Mission. With the stated intent to “support the replacement and upgrades of existing equipment and the addition of new equipment,” a tender for its upgrade was formally floated in February 2025. The purpose of the upgrade was to augment the capacity of the fab from the current 500–600 wafer starts per month (WSPM) to 1,500 WSPM and add Gallium Nitride on silicon technology to its suite of capabilities. This upgrade will be to the 200 mm wafer line at the SCL.
The SCL modernization plan is allocated ₹10,000 crore (approximately $1.2 billion) out of the total ₹76,000 crore (approximately $9.2 billion) earmarked for the ISM. This substantial investment underscores the significance attached to the SCL foundry’s modernization by the Indian government, as it serves mission-critical projects in both the ISRO and the Defence Research and Development Organization.
The key players for the SCL modernization bid were shortlisted in June 2025 after a technical evaluation. What remains now is the conclusion of the financial bid assessment, following which, the Indian government will decide on the letter of award for the SCL modernization. However, in its response to certain bidders’ queries, the SCL made clear that all plants and systems being procured must be new and if refurbished, it must have at least 80 percent residual life left. The next few sections of this article examine the rationale behind this stipulation and suggest areas for flexibility regarding sourcing equipment and systems for fabs, as evidenced by India’s other policies in the larger semiconductor and electronics sector.
New Equipment Versus Refurbished Equipment