Netherlands-based GX Group plans Rs 3,000 crore investment to build India’s first Photonic chip and module ecosystem

The new facility will focus on developing export-ready photonic modules catering to AI data centers, 5G/6G networks, LiDAR systems, and quantum communication technologies.

GX Group, a Netherlands-based telecom equipment maker, plans to invest Rs 3,000 crore over the next four years to build India’s first indigenous photonic chip and module ecosystem. The investment will go toward setting up a manufacturing facility in Rajasthan, advanced design and testing facilities, and forging supply chain partnerships, Paritosh Prajapati, CEO of GX Group, told Moneycontrol.

The investment marks a strategic push by GX Group to position India as a global hub for light-based data communication technologies that power next-generation AI data centres, 5G/6G networks, LiDAR systems, and quantum communication infrastructure — a market that presents a $50 billion opportunity in India.

The Rs 3,000 crore investment will be deployed in phases over four years to build a complete ecosystem — from design to eventual chip-level manufacturing — as India develops the necessary infrastructure and expertise. The total investment includes setting up advanced design and testing infrastructure, developing supply chain partnerships, and gradually scaling toward full-fledged manufacturing capability.

The first phase, with an initial investment of Rs 500 crore, will fund the setup of a manufacturing facility and R&D centre under a new subsidiary — GX Quantum Photonics Pvt. Ltd. — in collaboration with Smart Photonics (Netherlands).

The investment is primarily funded by Invest International, the Dutch government’s investment arm. “Seventy percent of the investment will come from Invest International, while the rest will be made by GX Group,” Prajapati said.

GX Group, which entered India in 2018, has steadily expanded its footprint with a manufacturing facility in Manesar (2021) and its largest R&D centre in Chennai (2022). It currently supplies products to Bharti Airtel, ACT Fibernet, Asianet, Excitel, Hathway, and KCCL, among others.

The company is now evaluating sites across Rajasthan, Uttar Pradesh, and Andhra Pradesh for the future expansion of its photonics manufacturing and R&D operations. It has chosen Bhiwandi as the location for its manufacturing facility, which will start operations in the first quarter of the next fiscal year with a capacity of 30 million units.

“We’re looking at this in different phases. The initial phase will focus on starting manufacturing. In the second phase, we plan to move into chip-level design and development. Right now, we’re co-designing the chip with our partners. We expect to start production in the first quarter of the next fiscal year. The facility will cater to domestic demand as well as export markets,” he said.

Prajapati said the investment comes at a time when India’s digital infrastructure is expanding rapidly.

“We see India’s data centres growing at an unprecedented pace. There are emerging opportunities across sectors — EVs, LiDAR (Light Detection and Ranging) systems, and defence — all of which rely heavily on photonics,” he said. “Traditionally, data communication used electronics to transmit data; now we’re talking about light.”

GX Group’s technology will initially focus on optical components used in data centres and telecom networks — areas that account for nearly 30% of a data centre’s total value. The company eventually plans to extend its photonics portfolio to other verticals such as EVs and defence, where LiDAR-based sensing is a key emerging technology.

In the photonics space, the company will compete with the likes of Nokia, Cisco, and Juniper. “If you look globally, there’s no Indian brand in the telecom or data centre space that can say its IP and technology are built in India. We want to change that. Our goal is to show that India can develop, design, and deliver world-class technology that competes with the likes of Nokia or Cisco.”

Currently, India imports nearly all its optical and photonic components — a gap GX Group aims to close. “Our goal is to reduce India’s import dependency in this segment by up to 90%,” Prajapati said. “What’s unique is that everything — hardware, software, and IP design — will be done right here in India. Our products are approved for the Indian market and exported globally. This proves that India can indeed build world-class technology.”

He also highlighted a strategic advantage for India’s manufacturing ecosystem: “An interesting aspect is that photonic components currently have no customs duty — which is great for India’s manufacturers.”

GX Group has applied under the Government of India’s semiconductor and component incentive schemes, and its Small Form-Factor Pluggable (SFP) optical products are already approved under the telecom Production-Linked Incentive (PLI) scheme. The company has achieved all five years of PLI manufacturing targets and received reimbursements for three years so far.

While the chip design work will be carried out in India in partnership with Smart Photonics, fabrication will initially take place overseas until India’s semiconductor ecosystem matures. “The expertise and facilities for chip fabrication are not yet available here. We aim to build design expertise first and gradually move toward complete chip manufacturing once the ecosystem is ready,” he said.

The company also expects to be eligible for the Design-Linked Incentive (DLI) scheme if the Indian government decides to invite foreign companies to participate, though the government has not yet clarified whether global companies will be eligible under version 2.0. “These will be new chip designs. The technology exists, but we’re creating a new way of applying and handling it,” he said.

GX Group, which reported Rs 400–500 crore in India revenues, is among the country’s most profitable communication solution providers. The company expects a 40% revenue jump once its photonics operations are fully functional next year.

Prajapati said GX Group’s vision is to position itself as a global technology brand built out of India, with revenues reaching Rs 2,000 crore by 2030.