While India is vigorously promoting the construction of a chip supply chain worth billions of dollars, a number of Indian chemical companies have announced their entry into the semiconductor industry. However, meeting the extremely stringent standards required by chip manufacturers not only requires high-purity purification technologies but also gaining customer recognition—skills that are lacking in Indian companies. Some companies have chosen to turn to overseas partners for support.
According to Nikkei Asia, India's chemical industry ranks sixth in the world in terms of scale, and it is capable of producing various bulk chemicals and specialty chemicals. On the surface, these products are also used in the semiconductor supply chain. However, what makes the chip industry ecosystem unique is its high requirements for purity. It is necessary to control metal impurities and moisture at levels measured in parts per billion (ppb) or even parts per trillion (ppt).
According to corporate registration documents, at least 10 Indian companies have indicated their interest in joining the semiconductor supply chain in recent months. These include established companies such as Gujarat Fluorochemicals, Navin Fluorine, and Tatva Chintan. As these companies announce their plans, the Tata Group is building India's first chip manufacturing plant, with plans to start commercial production by mid-2028.
"Although many people are saying they want to enter the semiconductor industry, it is easy to say but difficult to do." Chief Operating Officer Ravi Desai of Anupam Rasayan, headquartered in Gujarat, India, told Nikkei Asia.
Chip production requires the use of more than 150 chemicals and over 30 gases, including ultra-pure sulfuric acid, hydrofluoric acid, as well as gases such as helium and silane. There are very few companies around the world that can supply many of these products, and they are mainly located in countries like Japan, South Korea, and the United States. Chip manufacturers generally do not easily change suppliers, which creates obstacles for new entrants to the industry.
“At present, we do not have any Indian home-grown enterprises capable of independently achieving the commercialization of these ultra-high purity chemical products production processes.” said Ajay Joshi, founder of a consulting firm named after himself in the chemical industry. “However, all these enterprises claim they have the capability to do so.”
Josh said that there are two options for Indian companies: either cooperate with foreign companies that have the relevant technologies and customer resources, and join the global supply chain; or wait for the construction of India's first wafer factory to be completed, in order to verify their own capabilities.
“Local customers do not exist yet,” said Josh. “Therefore, the Indian chemical companies that place their hopes on local customers have yet to have their ideas proven, as their products have not been tested in such harsh production environments.”
For Indian companies that rely on domestic customers, the reality is that Tata Electronics, responsible for building wafer factories, has announced the signing of memorandums of understanding and partnerships with companies such as Sumitomo Chemical, Fujifilm, and Merck Electronics in Germany. These efforts aim to explore the supply of semiconductor materials and gases.
Meanwhile, several Indian chemical companies have chosen a different path.
Based in Gujarat, Acutaas Chemicals formed a joint venture with South Korean company J & Materials in 2025. The joint venture company, Indichem, opened a factory in Goyang City, South Korea in August this year. This factory specializes in producing photoresist chemicals, which are used to print circuit patterns on silicon wafers. It is expected that the company will start generating commercial revenue by the fiscal year ending March 2028.
We excel at low-cost chemical synthesis, but we need refining technology. Abhishek Patel, CEO of Acutaas, stated, "This is where our Korean partners can make a difference."
Patel said, “Theoretically, we can also use the same technology to build such factories in India. But issues related to infrastructure, human resources, and the local industrial ecosystem are concerning.”
Patel also mentioned that the certification process for suppliers is very long, and in some cases, it can take up to three years. Therefore, until there is sufficient demand in the Indian semiconductor industry ecosystem, Indichem will supply to the Korean market first. It may still take several years before the Indian domestic market reaches this level of demand.
Meanwhile, Anupam Rasayan completed the acquisition of American Jayhawk Fine Chemicals in February this year, in order to better enter the semiconductor value chain. The company has focused on the production of a few specific chemicals for many years, and now plans to add more than five new chemicals to its product range, aiming to participate in almost every aspect of chip manufacturing.
This industry will only accept— I have to say—very mature players who have years of performance records. CEO Gopal Agrawal said, “Jayhawk has helped us accelerate this process considerably because it has established a solid reputation among customers.”
He added, “Suppose I were a new company that has just entered this industry and wants to get into this value chain. Trust me, it will take at least 10 years. And for us, it took 6 to 8 years.”
However, in the field of semiconductor gases, companies must establish their capabilities in India, as many gases are difficult to import and the import process can be dangerous. For this reason, companies such as Inox Air Products and Airlife are building production facilities in India to meet the needs of Tata’s wafer factory.
Inox Air is investing 5 billion rupees in building a special gas center in Gujarat, where Tata's wafer factory is located.
Inox Air's Head of Strategy and Business Development, Diganta Sarma, stated that the related industrial networks in India are still in development, and some critical air separation equipment and high-purity purification systems still need to be imported.
Like chemicals, gases must also meet strict quality standards.
Silicon wafer factory needs to undergo months of evaluation before official recognition of gas supplier...Even small quantities, such as a few hundred million or a billionth of the total amount, may affect chip yield rate." Said Salma.
However, these companies must also take into account the construction period of gas plants.
Salma said: "Another important implementation challenge is coordinating the construction timeline of the gas plant with the start time of operations at the downstream wafer factory. The construction of the gas plant may take about 9 to 30 months, and it is essential to ensure that both timelines are aligned, so that the facilities won’t be left idle after completion."
