A rising number of overseas firms battling financial strain are seeking alliances with Indian companies to set up semiconductor manufacturing plants in the country, driven by generous state incentives, a vast domestic market and a large talent pool.As per ET, electronics major Sharp and US semiconductor producer Onsemi are among those exploring tie-ups, though both firms have not opened up about their plans yet. Industry observers say many of these companies are under pressure from aggressive Chinese rivals. “Chinese companies are taking over spaces that Korean and Japanese firms dominated,” a source following the matter was quoted as saying by ET. “For them, India offers a growing market. The potential of the Indian market that people have been looking at for two-three decades is now increasingly becoming a reality”, the source added.The India Semiconductor Mission offers substantial financial aid for ventures in silicon semiconductor fabs, display fabs, compound semiconductors, sensors, packaging and chip design. This framework is creating a favourable environment for manufacturers grappling with high costs and sluggish demand elsewhere. Analysts believe that collaboration with Indian partners, backed by heavy government subsidies, is an appealing lifeline for such companies.Several projects are already in progress, with the government approving joint ventures between established and new players. These initiatives aim to produce chips for consumer electronics as well as specialised automotive and industrial uses. Danish Faruqui, chief executive of Fab Economics, was cited by ET saying that combining foreign technology with Indian financial backing could be “lucrative for established players” struggling with operational shortcomings and a lack of capital to scale.However, experts caution that India must address gaps in trained manpower and technical skills to sustain this momentum. Faruqui noted that beyond capital and technology licences, “trained talent and skill sets across a variety of functions” are vital for high-value chip production. He warned that other nations in Southeast Asia and the Middle East are also racing to develop their own semiconductor ecosystems, making it crucial for India to strengthen its foundations quickly.