India has given the green light for the allocation of up to $15.2 billion to construct three new semiconductor plants, marking a significant move in the country’s efforts to compete with major players in the global chip industry.
Key Takeaway
India has approved a substantial investment of
5.2 billion for the establishment of three semiconductor plants, signaling its determination to strengthen its position in the global chip market.
First Semiconductor Fab Facility in India
The Indian cabinet has approved the establishment of the country’s first semiconductor fab facility, a joint venture between Tata Group and Taiwan’s Power Chip. The facility, to be located in the Dholera region of Gujarat, aims to produce 3 billion chips annually for various market segments, including high-power computers, electric vehicles, telecom, and power electronics.
Additional Semiconductor Initiatives
Alongside the semiconductor fab, the Indian government has also sanctioned the investment of $3.2 billion in a semiconductor assembly, testing, marking, and packaging unit in the northeastern state of Assam. This will be the country’s third semiconductor unit and is expected to cater to a wide range of industries, including automotive, electric vehicles, consumer electronics, and telecom.
In addition, the government has approved a $916 million investment from Japan’s Renesas Electronics and Thailand’s Stars Microelectronics to collaborate with the Indian company CG Power in producing specialized chips in Sanand, Gujarat. These chips will be tailored for niche sectors such as defense, space, electric vehicles, and high-speed trains.
Efforts to Boost Domestic Semiconductor Sector
India has been striving to enhance its domestic semiconductor sector, with previous initiatives aimed at attracting chipmakers and display manufacturers to set up local facilities in the country. The government has also outlined $7 billion in incentives for the newly announced semiconductor plants and the Micron facility, demonstrating its commitment to fostering a robust semiconductor ecosystem.
Furthermore, India is actively seeking to attract foreign semiconductor manufacturers by offering substantial incentives, with companies like Foxconn and AMD already announcing their investment plans for establishing local facilities.
Future Semiconductor Initiatives
Looking ahead, the Indian government has expressed its intention to design a semiconductor program spanning 20 years. With approximately 300,000 design engineers already involved in designing chips for global companies, India is poised to embark on various other semiconductor initiatives in the near future.
