Tata Electronics has lined up American chip designer Intel as a prospective customer as the division of Mumbai-based conglomerate Tata Group works to expand India's domestic electronics and semiconductor supply chain.Â
Under a Memorandum of Understanding, the companies will explore the manufacturing and packaging of Intel products for local markets at Tata Electronics' upcoming plants.
Intel and Tata also plan to assess ways to rapidly scale tailored artificial intelligence PC solutions for consumers and businesses in India.Â
In a press release on Monday, Tata said that the collaboration marks a pivotal step towards developing a resilient, India-based electronics and semiconductor supply chain.
"Together [with Intel], we will drive an expanded technology ecosystem and deliver leading semiconductors and systems solutions, positioning us well to capture the large and growing AI opportunity," said N Chandrasekaran, Chairman of Tata Sons, the principal investment holding company of Tata companies.Â
Tata Electronics, established in 2020, has been investing billions to build India's first pure-play foundry. The facility will manufacture semiconductor products for the AI, automotive, computing and data storage industries, according to Tata Electronics.Â
The firm is also building new facilities for assembly and testing.Â
India, despite being one of the world's largest consumers of electronics, lacks chip design or fabrication capabilities.Â
However, the Indian government has been working to change that as part of efforts to reduce dependence on chip imports and capture a bigger share of the global electronics market, which is shifting away from China.
Under New Delhi's "India Semiconductor Mission," at least 10 semiconductor projects have been approved with a cumulative investment of over $18 billion.
Intel CEO Lip-Bu Tan said the partnership with Intel was a "tremendous opportunity" to rapidly grow in one of the world's fastest-growing computer markets, fueled by rising PC demand and rapid AI adoption across India.