4 days ago
India’s Semiconductor Push Exposes a Missing Water Budget
A large chip factory is being built in Dholera, where the underground water is salty and cannot supply the factory.
The factory plans to bring water from the Narmada River through canals.
It will use thousands of kilolitres of water every day, although much of the water will be recycled.
Supporters say chip factories recycle water and use surface water instead of taking more from underground.
Critics say the river and canals are already needed by farms and towns.
Other chip factories and data centres may also need water in the same region.
Each project is currently checked separately, so officials may not see the total demand.
The article recommends adding up all water uses within each river basin.
This would help decide whether a new factory should be approved, moved, desalinate water or be refused.
Tata Electronics’ planned Dholera fab is expected to require about 17,549 kilolitres of water daily, including 6,571 kilolitres of fresh water.
Dholera taluka has no freshwater-bearing aquifer area, so the plant’s supply is planned from the Narmada through a canal system.
The article argues that project-by-project environmental clearances do not measure the combined water demands of fabs, packaging plants, data centres and existing users.
Industry advocates point to high recycling rates and the use of surface water rather than groundwater, while critics say these measures do not eliminate pressure on shared basins.
The proposed solution is a statutory, basin-level water budget that accounts for drinking water, irrigation, recharge and prior industrial allocations before approving new plants.
- Who
- Tata Electronics, other semiconductor companies and Indian government authorities are involved in the industrial expansion discussed.
- What
- The article examines the water requirements of India’s semiconductor projects and calls for basin-level cumulative water budgeting.
- Where
- The main focus is Dholera and Sanand in Gujarat, with water planned from the Narmada River.
- When
- The article cites the Union Cabinet’s approval of the second India Semiconductor Mission on 15 July 2026 and the inauguration of CG Semi’s Sanand plant on 4 July 2026.
- Why
- The proposed fabs and related facilities are being developed in water-stressed areas, while current environmental clearances assess projects individually rather than their combined effect on shared basins.
Cumulative Water Controls
Semiconductor Industry Expansion
Whether current clearances are sufficient
Cumulative Water Controls
The article argues that project-by-project approvals overlook the combined demand from multiple factories, data centres, farms and towns sharing a basin.
Semiconductor Industry Expansion
Each project can demonstrate an individual source of supply and meet its environmental-appraisal requirements, making approval defensible on its own terms.
Value of recycling and surface water
Cumulative Water Controls
Recycling improves process efficiency but does not remove the need for makeup water or reduce the total pressure on the basin; surface-water use shifts demand from groundwater to rivers and canals.
Semiconductor Industry Expansion
Modern semiconductor facilities recycle substantial amounts of water, and using surface water rather than groundwater can avoid directly adding to groundwater depletion from irrigation.
How new plants should be managed
Cumulative Water Controls
A basin-wide cap should reserve water for drinking and irrigation, disclose industrial withdrawals and require new plants to relocate, desalinate water or be refused when the balance is exhausted.
Semiconductor Industry Expansion
The article presents industry’s position as favouring continued semiconductor development based on recycling and planned surface-water supplies, while arguing that semiconductor water use is small compared with agriculture.
Key facts
- Dholera fab operator
- Tata Electronics
- Daily water requirement
- About 17,549 kilolitres, including approximately 6,571 kilolitres of fresh water
- Planned water source
- The Narmada River, transported through a canal
- Target production
- About 50,000 wafers per month at mature nodes from 28 to 110 nanometres
- Second India Semiconductor Mission
- Approved by the Union Cabinet on 15 July 2026 with an outlay of Rs 1.27 lakh crore
- CG Semi plant
- A Rs 7,600-crore assembly-and-test plant inaugurated at Sanand on 4 July 2026
- Micron water assurance
- More than 20 million litres per day of Narmada water, scalable to 90 million litres per day
- Proposed policy
- A public basin-level annual withdrawable water envelope, with industrial approvals debited against it










