Senior executives are engaged in active discussions with some of the top semiconductor manufacturers such as Taiwan Semiconductor Manufacturing Company (TSMC), Intel, AMD, Fujitsu, United Microelectronics Corp., as the government strives to drive the much-anticipated semiconductor investments in the country.
The ambitious plan is being closely coordinated and monitored by the Prime Minister’s Office (PMO) and multi-ministries have been involved in the process as the government works overtime to finalize a lucrative policy to woo semiconductor companies, which are also being pursued by other countries such as the US and Europe. “The government is ready to talk on capital support. We are as close to it as ever,” a top source engaged in the process told TOI.
The government had recently held a high level meeting on the matter in which Telecom and IT Minister ashwini vaishnav, Principal Scientific Adviser K Vijayaraghavan, top scientist and member of NITI Aayog VK Saraswati, Minister of State for IT Rajiv Chandrasekhar, representatives of the Ministries of Electronics, IT and Telecommunications, Defense Research and Development Organization (DRDO), Surface Transport and Space departments and academia.
“The idea is to have representatives of various ministries and departments who are in charge of the industries affected by the semiconductor shortage,” the source said.
Cards may benefit through programs such as financial assistance on capital expenditure, cutting tariffs on certain components, and plans to promote manufacturing of electronic components and semiconductors.Glasses) and Production Linked Incentives (PLIs). “All efforts will be made to develop an attractive and investment-friendly plan for companies looking to India.”
Currently, India imports almost all semiconductors to meet the projected demand of around $24 billion to reach around $100 billion by 2025. Previous attempts to get companies to invest in the semiconductor space have failed, particularly as sophisticated manufacturing processes require huge investments, in addition to uninterrupted clean water and electricity supplies.
While India is seen as strong in the field of chip design, it has failed to achieve the much-hyped fab manufacturing in the country which involves an investment of between $5 billion and $10 billion. However, the onset of the corona pandemic in early 2020 and the strategy of many global companies to look at ‘China plus 1’ policy for procurement is likely to help in getting investments in India.
The government is confident that a large and rapidly growing electronics market, apart from needs in other industries such as defence, automobiles, space and new-age technologies such as 5G and Internet of Things (IoT), will prompt companies to invest. India.
“Domestic demand is going to be very high. The government expects domestic electronics production to reach $350-400 billion by 2025, up from an estimated $75 billion now. This will be a big enabler for getting investments. ”
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