Germany Adopts Comprehensive Microelectronics Strategy to Strengthen Semiconductor Leadership

The German Federal Cabinet adopted the "Microelectronics Strategy of the Federal Government: Research, Skilled Labour and Manufacturing for the Microelectronics Ecosystem in Germany" on October 15, 2025. Jointly presented by the Federal Ministry for Research, Technology and Space (BMFTR) and the Federal Ministry for Economic Affairs and Energy (BMWE), the strategy represents one of the first major strategic measures to implement Germany's Hightech Agenda Deutschland (HTAD).​

Framework and Core Objectives

The strategy aims to enhance Germany's attractiveness as a microelectronics location by integrating research, skilled labour, and manufacturing. Federal Minister for Research, Technology and Space Dorothee Bär emphasized that microelectronics is a key technology that is both research-intensive and fundamental to prosperity and technological sovereignty. She stated the strategy demonstrates Germany's commitment to accelerating the implementation of the Hightech Agenda Deutschland, with the goal of making Germany the European centre for chip design and strengthening the transfer from science to business.​

Federal Minister for Economic Affairs and Energy Katherina Reiche highlighted that microelectronics forms the basis for value creation, growth, and prosperity. She noted that recent experiences have demonstrated the economy's vulnerability when chips cannot be delivered and supply chains are disrupted, emphasizing that without microelectronics, no car drives, no energy infrastructure operates, and no communication network functions. The strategy's objective is to ensure Germany remains not only a user but also a developer and manufacturer of microelectronics.​

Six Interconnected Action Fields

The microelectronics strategy encompasses six interconnected action fields: expansion of chip design capabilities, acceleration of technology transfer from research to industrial manufacturing (from lab to fab), increase in the number of skilled workers, improvement in the qualification of skilled workers, creation of investment incentives, and expansion of European and international cooperation. The strategy also addresses the framework conditions for microelectronics production in Germany and considers economic and research security.​

Three Central Guiding Themes

The strategy follows three central guiding themes. First, it focuses on expanding existing economic and technological strengths, particularly where European capabilities are indispensable in the global semiconductor value chain, thereby improving geopolitical negotiating power and strengthening existing customer industries. Second, it aims to unlock new microelectronics technologies based on research intended to fill the pipeline for the next generation of chips and economically develop new microelectronics applications, guided by future needs of chip user industries and economic potential. Third, it strengthens the resilience of existing supply chains through targeted measures based on security and risk analysis, beyond a mere focus on capacity building and market share, also considering the relevance of microelectronics for security, critical infrastructure, and other key technologies such as artificial intelligence and quantum technologies.​

Implementation Mechanisms and European Integration

Implementation of the strategy will proceed swiftly through close dialogue between the federal government, industry, science, federal states, and associations. A "Chips Office" will coordinate and organize interaction with stakeholders and promote implementation as a learning strategy. The BMFTR and BMWE will work intensively on revising the European Chips Act in line with the federal government's strategic objectives. The BMFTR will establish a competence centre for chip design and implement an initial flagship project for the "supercomputer in the car" to prepare the automotive and mechanical engineering industries for the future. The BMWE will advance the approval of additional projects under the European Chips Act and is already working with European partners on the conception of an IPCEI "Advanced Semiconductor Technologies" (AST).​

The strategy is consistent with the objectives of the "Semicon Declaration" presented in Brussels on September 29, 2025, which was developed jointly by BMFTR and BMWE with European partners. All 27 EU member states signed this declaration calling for a revised and forward-looking EU Chips Act to strengthen Europe's position in the global semiconductor industry. The Semicon Declaration emphasizes five priorities: strengthening the semiconductor ecosystem through collaboration, aligning investment and funding mechanisms, enhancing skills through a robust European talent pipeline, promoting sustainability, and expanding international partnerships while protecting European strategic autonomy.​

Relevance for Indian Stakeholders

This development holds significant implications for Indian stakeholders in the semiconductor sector. Germany's emphasis on international cooperation and partnerships creates opportunities for India-Germany collaboration in microelectronics. The two countries have already demonstrated commitment to semiconductor partnership through the 7th Fraunhofer Innovation and Technology Platform (FIT) 2025, held in July 2025, where a joint knowledge paper was unveiled outlining strategic cooperation in areas including CMOS chip design, sensor systems, MEMS, advanced packaging, system reliability, and workforce development.​

India's semiconductor market, valued at approximately USD 45-50 billion in 2025 and projected to reach USD 100-110 billion by 2030, represents substantial growth potential that aligns with Germany's strategy to expand European capabilities in the global semiconductor value chain. The Indian Semiconductor Mission, which has approved ten projects with investments exceeding INR 1.26 lakh crore since 2021, demonstrates India's commitment to building a robust semiconductor ecosystem. Partnerships with Germany can provide Indian companies and institutions access to advanced research capabilities, manufacturing expertise, and technology transfer opportunities that Germany's strategy explicitly promotes.​

Tata Electronics has already signed a memorandum of understanding with Germany's Robert Bosch GmbH to jointly develop advanced chip packaging and semiconductor manufacturing capabilities. Such collaborations demonstrate how Germany's microelectronics strategy, which emphasizes bridging the gap from lab to fab and strengthening international cooperation, can benefit Indian stakeholders seeking to advance their technological capabilities and integrate into global semiconductor supply chains. As Germany establishes its competence centre for chip design and advances the IPCEI Advanced Semiconductor Technologies with European partners, Indian companies and research institutions have opportunities to participate in joint research projects, access pilot lines, and develop capabilities in next-generation semiconductor technologies.