Centre Set to Prioritise Memory Chips Under Semicon Mission 2.0

Why It Matters

Prioritizing HBM positions India to capture a strategic slice of the AI‑driven memory market, reducing reliance on foreign suppliers and attracting high‑value manufacturing jobs. It also signals the government’s response to geopolitical tech controls and supply‑chain shocks.

Key Takeaways

• ISM 2.0 focuses on high‑bandwidth memory (HBM) production.
• HBM market dominated by SK Hynix (57%) and Samsung (22%).
• Micron's $2.5 bn Gujarat plant targets 10% global output.
• HBM manufacturing not yet planned at Micron's Sanand facility.
• India aims to join AI‑critical memory value chain.

Pulse Analysis

The surge in high‑bandwidth memory demand is being driven by AI‑intensive workloads that require massive data throughput. Global data‑center operators are expanding capacity faster than traditional DRAM can keep up, pushing HBM prices to multi‑year highs. This creates a lucrative niche for manufacturers, but the technology remains concentrated in a handful of firms, raising concerns about supply security for emerging AI ecosystems.

India’s decision to earmark roughly $12 billion for ISM 2.0 reflects a strategic pivot toward this high‑margin segment. By emphasizing advanced packaging and HBM production, the government hopes to move beyond the broader semiconductor ecosystem of ISM 1.0 and capture downstream value. The policy aligns with other nations’ tech‑sovereignty agendas, positioning India as a potential hub for AI‑critical components while mitigating exposure to export controls from major economies.

Micron’s $2.5 billion Sanand facility illustrates the immediate impact of the mission’s incentives. Although the plant currently focuses on DRAM and NAND assembly, its scale—one of the world’s largest single‑floor cleanrooms—lays groundwork for future HBM lines. Delivering roughly 10 % of Micron’s global memory output, the site will boost local employment and skill development. The challenge remains to transition from assembly to full‑stack HBM fabrication, a step that will require additional capital, supply‑chain partners, and regulatory support. Success could anchor India’s role in the AI memory value chain and diversify global HBM sources.