Semiconductor sovereignty moves
Governments are tightening support for domestic chip capacity as a strategic hedge, not just industrial policy. Japan approved an extra ¥631.5bn to accelerate Rapidus R&D, and India is explicitly pushing toward domestic semiconductor innovation to reduce import dependency (thenews.com.pk) (pcquest.com).
Japan and India are putting more state money and policy weight behind domestic chip capacity as insurance against supply shocks, not just as factory-building plans. (reuters.com) Japan’s industry ministry approved an additional ¥631.5 billion, about $3.96 billion, for Rapidus on April 11, 2026, to speed research and development on advanced semiconductors. Reuters reported the new package lifts Rapidus’ total research and development assistance to ¥2.354 trillion. (reuters.com) Rapidus is trying to mass-produce 2-nanometer chips in fiscal 2027, and its pilot line in Chitose, Hokkaido, started up in April 2025. The company said it successfully prototyped 2-nanometer gate-all-around transistors in July 2025, a checkpoint on the way to volume production. (rapidus.inc 1) (rapidus.inc 2) A semiconductor is the tiny switch network inside phones, cars, servers, and weapons systems, and countries want more control over where those switches are designed, made, and packaged. Japan’s latest Rapidus funding was framed by the government as part of a push to strengthen domestic production of advanced chips and secure supply chains. (reuters.com) India is making a parallel bet, but from a different starting point: it is building an ecosystem that covers design, fabrication, assembly, testing, and packaging after decades of relying heavily on imports. The Ministry of Electronics and Information Technology says the India Semiconductor Mission is meant to create that full stack inside the country. (meity.gov.in) (pib.gov.in) New Delhi approved the India Semiconductor Mission in 2021 with a ₹76,000 crore outlay, and by 2025 the government said total approved projects had reached 10 with cumulative investment of about ₹1.60 lakh crore across six states. In March 2025, India Semiconductor Mission signed a fiscal support agreement for Tata’s ₹91,526 crore semiconductor fab project in Dholera, Gujarat. (pib.gov.in 1) (pib.gov.in 2) India is also trying to move beyond assembly into chip design. The government said 23 chip-design projects had been approved under its Design Linked Incentive scheme, with startups leading several of them. (ibef.org) The two pushes are not identical. Japan is spending heavily to re-enter the front rank of advanced logic manufacturing through one national champion, while India is spreading incentives across fabs, outsourced semiconductor assembly and test plants, and design programs to build a base it never fully had. (reuters.com) (pib.gov.in 1) (pib.gov.in 2) Both strategies come with execution risk. Rapidus still has to win customers in a market dominated by larger incumbents, while India still has to turn approved projects and subsidies into sustained output, supplier networks, and yields that make local production competitive. (bloomberg.com) (pib.gov.in) The near-term test is simple: whether public money produces reliable domestic capacity before the next shortage does. Japan’s 2027 target for Rapidus and India’s build-out across fabs and packaging plants will show how far “chip sovereignty” can move from policy slogan to production line. (rapidus.inc) (pib.gov.in)
