Silicon froth: AI chips are riding a massive global wave that could turn without warning

Subscribe to enjoy similar stories.The surging shares of US chipmakers such as Intel and Micron point to a deeper shift in artificial intelligence (AI). First, the narrative is moving from a speculative buzz around AI models to hard spending on the infrastructure that powers them. Second, big money is flowing into computing power and memory, the choke points of the AI economy.

For India, these shifts augur well. The country is building 12 semiconductor plants (including a full-fledged fab facility), pursuing 2 nanometre and 3nm chip-design alliances and subsidizing AI chips for startups working on Indian language and voice models. India’s AI Kosh repository hosts nearly 10,500 local datasets and about 300 models across 20 sectors, forming a data backbone linked to Aadhaar, UPI, et al.

Progress on chip design is tangible. Various institutes have used government-backed tools to design and produce roughly 150 chips at the 180nm node. New Delhi has cleared 24 semiconductor and system-on-chip design projects across strategic areas—from video surveillance and drone detection to energy metering, microprocessors, satcom services, broadband and internet-of-things.

Some 14 firms have raised over ₹650 crore in venture funds to scale these efforts, while work is on for chip fabrication at more advanced nodes (such as 12nm). India also has supply chain links with the US, EU, Japan, Singapore and the Netherlands. That is a lot of action.

Chip advances are a must for success in electronics overall, not just AI. However, this is not a field for the faint of heart, given how fast its dynamics can shift. Chip fabrication is capital-intensive, requiring time and scale, apart from technical depth and execution skills.