Smart Cities & Semiconductors Chips Are Building the Future of Urban Living

Semiconductor Hub

The semiconductor market is rapidly expanding with urbanization leading to a smart and brighter future. According to reports from Forbes semiconductor chips will drastically reduce on a global scale with connected homes, buildings and energy grids that analyse energy consumption rates and distribute energy accordingly. The rise of smart cities is fuelled by advanced semiconductors, enabling real-time data processing, AI-driven infrastructure, and seamless internet of things (IoT) connectivity. From traffic management to energy efficiency, chips are the backbone of urban innovation.

• According to Economic Times of India, Tata Group in partnership with Powerchip Semiconductor Manufacturing Corp of Taiwan will roll out the first set of semiconductors from the Dholera plant in December 2026 in Gujrat, India.
• The government’s Chips to Startups (C2S) initiative has equipped more than 100 academic institutions in the country with electronic design automation (EDA) tools from Siemens EDA and others.
• In semiconductor assembly, packaging & testing, Firms invest 15% of their annual revenues in facilities and equipment. This activity accounts for 13% of the total industry capital expenditure and contributed 6% of the total value added by the industry in 2019.
• Since the CHIPS Act was introduced in USA, companies have announced 90 new projects across 28 states, with hundreds of billions in private investments and creating 58,000+ direct jobs in the semiconductor ecosystem.
• A 2023 SIA-BCG report projects a 203% surge in U.S. semiconductor production capacity from 2022–2032—the highest growth rate globally—with America capturing 28% of global semiconductor capex (2024–2032).
• The rapid growth of connected technologies has created an urgent need for skilled STEM professionals not just for R&D, but across manufacturing, maintenance, and cyber security.
• Semiconductors powering everything from AI to smart cities, the industry faces a critical workforce gap that could delay technological progress and leave systems vulnerable to security risks.
• India can become a global semiconductor hub by developing a domestic supply chain for critical materials like chemicals, gases, and equipment - currently 80% imported. The government is preparing new incentives to attract ancillary manufacturers and reduce the 20-30% cost disadvantage faced by chipmakers setting up in India.
• In an ambitious move, India plans to start manufacturing advanced semiconductor equipment - a sector currently dominated by a few Western nations. The government is in talks with global leaders like ASML and Applied Materials to establish local R&D or production units, which could significantly reduce fab setup costs in the country.