January 1, 2026: As India looks ahead to 2026, the AI and semiconductor industries are on the brink of significant milestones that could reshape the country’s role in the global economy. From the rapid expansion of electronics manufacturing to the emergence of cutting-edge semiconductor facilities, India’s ambitions are clear: become a self-reliant, global leader in technology innovation.
The next few years will be pivotal in determining whether India can shift from being a major consumer of chips to a powerhouse of semiconductor production. But challenges remain, including building a local supply chain, fostering innovation, and encouraging both domestic and international companies to invest in India’s growing tech ecosystem.
Why India’s Semiconductor and AI Surge Will Reshape 2026 Markets
By 2026, India is expected to see the first of its semiconductor assembly, testing, marking, and packaging (ATMP) facilities enter commercial production. Companies like Micron, Tata Semiconductor Assembly and Test, CG Power-Renasas-Star, and Kaynes Semicon are all preparing to ramp up operations in the next two years. These developments are part of India’s larger strategy to reduce its reliance on imports, which currently cost the country up to $120 billion annually.
“At least one of these ATMP facilities will start operations in 2026, marking a crucial step in India’s semiconductor journey,” said a member of the advisory committee of the India Semiconductor Mission (ISM). The goal is to scale up the production of essential components for devices in industries like automotive, industrial electronics, IoT, and consumer appliances.
While fabrication plants, or “fabs,” are more complex and may not be fully operational until 2028, experts believe the country’s push for assembly and packaging could lay a solid foundation for long-term success. However, for this effort to truly succeed, India must focus on creating a complete semiconductor ecosystem, including raw material suppliers and local OEMs (Original Equipment Manufacturers) who use these chips in their final products.
The Missing Link: Building the Entire Ecosystem
India’s government has invested heavily in semiconductor fabrication, but experts warn that the real test will come with the development of a full, self-sustaining ecosystem. “The next phase of India’s semiconductor push must focus on downstream and upstream players,” explained an executive close to CG Power.
Upstream companies, including those that supply raw materials and chemicals, are crucial to chip production. As it stands, India still imports many of the specialized chemicals, such as epoxy molding compounds and plating chemicals, which are essential for semiconductor manufacturing. “Without localizing these chemical supplies, India will struggle to compete on price with global players,” said the executive.
Equally important is the development of a robust downstream ecosystem. For semiconductor assembly to be successful, India needs OEMs to establish manufacturing hubs within its borders. “If these OEMs continue to source chips from Southeast Asia, the impact of local semiconductor production will be limited,” the source added.
GCCs: India’s Growing Influence in Global Tech Innovation
In parallel to the semiconductor sector’s rise, India’s Global Capability Centres (GCCs) are evolving into key players in the global technology ecosystem. These centres, which were once seen primarily as cost-saving hubs, are increasingly driving innovation, particularly in areas like AI and data science.
By 2026, India will likely solidify its position as a global leader in technology innovation. With over 1,700 GCCs already operating in the country and employing nearly 1.9 million professionals, the sector is expected to grow even further. “India has become a go-to destination not only for back-office functions but for high-end tech work,” said an industry analyst.
In recent years, GCCs have been investing heavily in AI and data-driven research and development. According to the EY GCC Pulse Report 2025, 58% of GCCs are now investing in agentic AI, and 83% are scaling Generative AI technologies. This transformation has seen India’s tech sector shift from being a cost-centre to becoming a driver of global innovation.
The AI Boom: A Game-Changer for GCCs
India’s growing focus on Artificial Intelligence is also reshaping the landscape for GCCs. As more companies look to integrate artificial intelligence into their operations, GCCs are positioning themselves at the forefront of this technological shift. “We’re not just looking at cost-efficiency anymore; GCCs are now about driving strategic value through AI and innovation,” said an expert in the field.
InCommon, a research group tracking this development, estimates that GCCs now account for 22.5% of India’s total artificial intelligence talent demand. Notably, Fortune 500 companies are now hiring artificial intelligence professionals at scale, with more than 126,600 people employed in AI-aligned roles in India’s GCCs. This demand has fueled the growth of AI-native engineering, trusted data governance, and advanced R&D within these centres.
Mid-Sized Companies and Startups: The New Frontier
As 2026 approaches, India’s GCC sector is also seeing a shift toward mid-sized companies and startups setting up operations within the country. Historically, global corporations were the primary investors in India’s GCCs. However, increasing confidence in India’s tech ecosystem has encouraged mid-market and private equity-backed companies to follow suit.
“More companies are recognizing India’s potential not just for cost savings but for high-impact technology development,” said Piyush Kedia, co-founder of InCommon. “In 2026, we’ll see the emergence of ‘India-first’ pods dedicated to AI, data, and platform work.”
This trend is expected to play a crucial role in the country’s economic future, especially in Tier II cities, which are becoming more integral to the talent strategy of both large and mid-sized firms.
What Does This Mean for India?
For India, 2026 represents a critical juncture in its ambitions to lead in tech and semiconductor manufacturing. The government’s investments in semiconductor plants, Artificial Intelligence, and GCCs are laying the groundwork for a more self-sufficient and innovative economy. However, success will depend on how well the country can foster an integrated ecosystem that supports all levels of the supply chain—from raw materials to finished products.
“The challenge now is to connect the dots—bring together chip design, local manufacturing, and a strong OEM base,” said another expert. “India has the talent and market size to make it happen, but it needs a comprehensive approach to create a globally competitive ecosystem.”
With these developments in place, India could be on track to become not just a hub for manufacturing but a global leader in technology innovation, offering a unique blend of design expertise, manufacturing capacity, and a massive consumer base. What happens in the next few years will define whether the country’s semiconductor and tech ambitions are realized, or whether they remain a distant dream.
