Pioneering India's Semiconductor Sovereignty
The Andhra Pradesh Semicon Fabless Policy 2026 is a bold and visionary step towards transforming India’s semiconductor landscape, aligning perfectly with the nation’s aspirations for self-reliance in this critical technology. As the world relies more heavily on semiconductors—powering everything from smartphones to cutting-edge computing—Andhra Pradesh aims to position itself as the epicenter of India’s semiconductor independence.
By fostering innovation and driving excellence in semiconductor design and production, Andhra Pradesh is set to lead India’s charge in becoming a global semiconductor powerhouse. This ambitious initiative strengthens the state’s role as a key player in the global technology ecosystem, ensuring it remains at the forefront of the digital revolution.
Recognizing the vital role semiconductors play in enabling transformative technologies like Generative AI, cloud computing, and data sovereignty, the policy lays the groundwork for next-generation innovation. By building a robust semiconductor design and development ecosystem, Andhra Pradesh is not only securing its economic future but also contributing to the creation of a secure and resilient digital infrastructure for India and the world.
Join us in Andhra Pradesh—a state poised to be a $1 trillion economy by 2034—as we lead the way in shaping the future of technology.
Vision for 2030
Andhra Pradesh Leading India’s Semiconductor Sovereignty
By 2030, Make in Andhra Pradesh envisions establishing the state as the cornerstone of India’s semiconductor sovereignty, especially in the fabless semiconductor design segment. The policy’s vision includes:
- Establish Andhra Pradesh as a Hub for Fabless Semiconductor Innovation: Attract 100-120 fabless semiconductor companies to position the state as a critical player in the global semiconductor supply chain.
- Champion India’s National Semiconductor Strategy: Drive innovation in secure chip design, ensuring Andhra Pradesh leads in developing technologies vital for national security, critical infrastructure, and defense capabilities.
- Enable Cutting-Edge Data Solutions: Support the growth of next-generation data centers powered by indigenous chips, ensuring secure cloud computing and data sovereignty to fuel Generative AI and other transformative AI-based innovations.
- Boost High-End Employment Opportunities: Generate 5,000 to 6,000 specialized jobs in semiconductor design, research, and development, fostering economic growth and enhancing national security.
Mission
Driving India’s Semiconductor Sovereignty and Digital Future
The mission of Make in Andhra Pradesh is to lead India toward semiconductor sovereignty by creating a robust semiconductor design and manufacturing ecosystem that fuels the state’s digital economy and supports secure, AI-enabled infrastructure. Through the Andhra Pradesh Semicon Fabless Policy 2026, the state aims to:
- Strengthen India’s National Security: Develop trusted, secure chips tailored for sensitive sectors such as defense, telecom, and critical infrastructure, ensuring the integrity of vital systems.
- Safeguard India’s Data Sovereignty:Build state-of-the-art data center infrastructure underpinned by secure, indigenous hardware, providing a robust foundation for future technologies like Generative AI.
- Position Andhra Pradesh as a Fabless Chip Design Leader: Attract investments, foster innovation, and cultivate a collaborative ecosystem uniting academia, industry, and government to drive advancements in semiconductor design.
- Empower Global Innovation: Encourage global corporations to establish R&D centers in Andhra Pradesh, focusing on cutting-edge AI chips, machine learning processors, and cloud computing technologies that will fuel the next wave of AI-driven progress.
Key Objectives
Securing India’s Semiconductor Future
The Andhra Pradesh Semicon Fabless Policy 2026 is a strategic initiative designed to achieve key national and state-level objectives:
- Achieving Semiconductor Sovereignty: By prioritizing the development of indigenous chips, Andhra Pradesh will play a pivotal role in India’s journey toward semiconductor self-reliance—essential for safeguarding national security, ensuring data privacy, and driving AI-based technological advancements.
- Securing Digital Infrastructure with Indigenous Chips:The policy emphasizes creating advanced data centers powered by domestically designed chips, supporting critical digital infrastructure and AI platforms while protecting India’s data sovereignty.
- Attracting Global Investments in Fabless Design: Andhra Pradesh will aim to attract 100-120 fabless semiconductor companies by offering incentives for innovation, R&D, and productization, supporting both national and international markets.
- Driving Innovation in AI and Secure Computing:The state will focus on cutting-edge R&D in AI chips, quantum computing, and secure chip designs, enabling transformative AI innovations like Generative AI that demand vast computing power and heightened security.
- Building an Industry-Ready Workforce: By forging strong partnerships between academia and industry, Andhra Pradesh will nurture a skilled talent pool in semiconductor design, VLSI, and AI-powered hardware, ensuring a competitive edge in the global market.
Strategic Focus Areas
Building India’s Semiconductor Sovereignty and AI-Enabled Future
Developing Fabless Semiconductor Clusters
Andhra Pradesh will create dedicated semiconductor design clusters in Vijayawada, Nagpur, Visakhapatnam, and Aurangabad, equipped with world-class infrastructure and collaborative workspaces. These clusters will serve as innovation hubs for semiconductor design, research, and development, advancing the creation of secure chips to power data centers, AI platforms, and critical national defense systems.
Building Secure Data Centers Powered by Indigenous Chips
To uphold data sovereignty and drive the future of cloud computing and AI infrastructure, Andhra Pradesh will prioritize the development of secure data centers powered by domestically designed chips. These state-of-the-art facilities will support critical sectors such as banking, telecom, and defense, while providing robust infrastructure for Generative AI, machine learning, and Big Data analytics.
Promoting AI-Based Semiconductor Innovation
Andhra Pradesh will spearhead innovation in AI-focused chip design, emphasizing the development of AI processors and edge-computing chips that deliver faster, more secure AI applications. The policy will actively support R&D in AI chip technologies, essential for scaling Generative AI models that demand immense computational power and robust security.
Fostering Talent for Semiconductor and AI Ecosystems
Make in Andhra Pradesh will focus on cultivating industry-ready talent by collaborating with top academic institutions to introduce specialized programs in VLSI, AI chip design, and cloud computing hardware. These initiatives will ensure a highly skilled workforce to drive the success of fabless semiconductor companies and AI-centric R&D centers in the state.
Strengthening India’s National Security through Secure Chips
The policy will prioritize the development of secure chip designs tailored for critical sectors like defense, telecommunications, and essential infrastructure. By advancing trusted semiconductor technologies, Andhra Pradesh aims to strengthen India’s national security and minimize reliance on foreign chip solutions.
Incentives for Fabless Semiconductor and AI Investments
The Andhra Pradesh Semicon Fabless Policy 2026 offers a comprehensive range of incentives to attract investments in fabless semiconductor companies and AI chip R&D:
| Incentive Type | Details |
| Land Subsidy | Concessional rates for land allocation in semiconductor clusters. First 5 projects with investments above INR 5000 crore will receive an additional 25% discount. |
| Stamp Duty Exemption | 100% exemption on stamp duty for semiconductor projects. |
| Capital Investment Subsidy | 25% Capex contribution on project Capex (for projects under India Semiconductor Mission) or 30% for non-ISM projects. |
| Electricity Duty Exemption | 100% exemption from electricity duty and electrical inspection fees for 10 years. |
| Power Tariff Subsidy | Reimbursement of Rs. 2/unit for power consumption for a period of 10 years. |
| Interest Subsidy | 5% interest subsidy on term loans, capped at INR 25 crores per annum for 7 years. |
| SGST Reimbursement | 100% reimbursement of net SGST, limited to 200% of the plant and machinery cost. |
| Raw Materials Support | 10% capex incentive for raw materials, in addition to Govt of India’s 25% incentives under the SPECS scheme. |
| AI and Generative AI R&D Support | 50% subsidy on R&D expenses for AI-focused chip design, with additional support for scaling Generative AI models. |
| Patent Registration Incentives | Reimbursement up to INR 5 lakhs for domestic patents and INR 10 lakhs for international patents. |
| Fabless Companies | Seed funding of 10% of development costs, with an additional 10% reimbursement on achieving project milestones. |
| Manufacturing Incentives (PLI) | Manufacturing Incentives (PLI) |
Ease of Doing Business
Streamlined Approvals for National Security and AI Innovation
Andhra Pradesh’s Single Window Clearance System will streamline approvals for semiconductor and AI-focused projects, offering expedited clearances for initiatives related to national security chip designs and AI infrastructure. An Apex Committee will oversee the policy’s execution, ensuring companies receive timely approvals, incentives, and support to scale their operations efficiently.
Conclusion
Andhra Pradesh at the Forefront of India’s Semiconductor and AI Future
The Andhra Pradesh Semicon Fabless Policy 2026 establishes the state as a global leader in semiconductor design, data sovereignty, and AI innovation. By advancing India’s semiconductor independence, creating secure data centers, and developing AI-driven hardware, Andhra Pradesh will be at the forefront of shaping the future of Digital India.