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Massive Make In India PUSH – Modi Govt approves three semiconductor proposals in Gujarat and Assam

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The Modi Govt Cabinet on Thursday approved three semiconductor proposals amounting to ₹1,25,600 crore in value in Dholera and Sanand in Gujarat, and in Morigaon in Assam. The Dholera and Morigaon facilities will be built by Tata Electronics Pvt. Ltd. and Tata Semiconductor Assembly and Test Pvt. Ltd. The former will be a full-fledged fabrication unit producing 50,000 ‘wafer starts,’ the initial form of silicon chips, per month.

Powerchip Semiconductor Manufacturing Corporation of Taiwan will be the technology partner for the fab unit, while the assembly and testing unit in Morigaon’s technology partners have been kept confidential at their request, Minister of Electronics and Information Technology Ashwini Vaishnaw told reporters.

The Dholera units will be used to make “high performance compute chips with 28 nanometre technology,” and also to make chips for power management, which Mr. Vaishnaw said accounted for a large part of semiconductor demand. Both facilities’ output will cater to domestic demand as well as export their produced chips, Mr. Vaishnaw said.

Construction will start within 100 days, he added, hoping that the work is done well before the standard 5 year timeline for such facilities. The chip assembly facility by Micron, announced last year, is on track to have its first chip produced by December 2024, Mr. Vaishnaw said. The facilities announced on Thursday will create 20,000 direct jobs and 60,000 indirect jobs, the IT Ministry estimated in a note.

The facility in Sanand will also be a packaging unit, set up by CG Power with technology from the Renesas Electronics Corporation of Japan and Stars Microelectronics of Thailand.

He said within a very short time, India Semiconductor Mission has achieved four big successes.

“With these units, the semiconductor ecosystem will get established in India. India already has deep capabilities in chip design. With these units, our country will develop capabilities in chip fabrication.

Advanced packaging technologies will be indigenously developed in India with today’s announcement,” the minister said.

The Programme for Development of Semiconductors and Display Manufacturing Ecosystem in India was notified in December 2021 with a total outlay of ₹ 76,000 crore.

In June, 2023, the Union Cabinet approved the proposal of Micron for setting up a semiconductor unit in Sanand, Gujarat. An official release said that construction of this unit is progressing at a rapid pace and a robust semiconductor ecosystem is emerging near the unit.

Within a very short time, India Semiconductor Mission has achieved four big successes. With these units, the semiconductor ecosystem will get established in India. India already has deep capabilities in chip design. With these units, our country will develop capabilities in chip fabrication.

Advanced packaging technologies will be indigenously developed in India with today’s announcement. These units will generate direct employment of 20 thousand advanced technology jobs and about 60 thousand indirect jobs.

These units will accelerate employment creation in downstream automotive, electronics manufacturing, telecom manufacturing, industrial manufacturing, and other semiconductor consuming industries.

Modi govt’s semiconductor push, the story so far

The Centre has already disbursed more than Rs 1,600 crore in product-linked incentive (PLI) schemes to boost electronics manufacturing in the country. In 2023, the government expeditiously advanced its agenda through the Indian Semiconductor Mission (ISM).

A new incentive plan is in the works for the semiconductor industry and will have a corpus of Rs 10,000 crore, ET has reported. However, it will be an upgraded version of the current Scheme for the Promotion of Manufacturing of Electronic Components and Semiconductors (SPECS).

The corpus of the SPECS plan is currently around Rs 3,200–3,300 crore. It could be further structured in a way to disburse funds as and when the companies invest or achieve certain milestones.

In June last year, the Idaho-headquartered firm Micron Technologies became the first overseas company to commence construction under ISM and announced a $2.75 billion chip packaging plant in Gujarat. Meanwhile, global technology behemoth Foxconn has also evinced interest in setting up at least four semiconductor fabrication units in India.

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