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Cabinet approves ₹1.26 lakh crore investment in three semiconductor facilities

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Press Releases 01 Mar 2024 03:03 PM IST PIB

The Union Cabinet accepted the proposal to invest ₹1.26 lakh crore in three semiconductor factories. While the third unit would be located in Assam, the first two will be established in Gujarat. India will have four of them, and the first unit's supply is anticipated by year's end.

CG Power will establish a plant in Sanand, Gujarat, while Tata Group will put up two units in Dholera, Gujarat, and Morigaon, Assam. "After the Cabinet meeting, there will be a Bhoomi pooja for all three plants shortly, and construction will begin within 100 days," stated Telecom Minister Ashwini Vaishnaw in a news conference. He went on to say that building typically takes three to four years. However, “we have been able to compress the time for the Micron Unit and hope to repeat the same for all three plants,” he said.

The units will make chips for sectors including defence, automobiles and telecommunications and will be set up under the ‘Development of Semiconductors and Display Manufacturing Ecosystem’ programme that provides government support of up to ₹76,000 crore, out of which ₹59,000 crore to be made available to these four plants.

Tata Electronics Pvt Ltd will set up a semiconductor fab in partnership with Taiwan‘s Powerchip Semiconductor Manufacturing Corp at Dholera in Gujarat. The plant will be able to produce 50,000 wafers per month and involve an investment of ₹91,000 crore. This will produce high-performance compute chips with 28 nm technology for electric vehicles, telecom defence, automotive, consumer electronics, display and power electronics.

Tata Semiconductor Assembly and Test Pvt Ltd (TSAT) will set up a semiconductor unit in Morigaon, Assam, at an investment of ₹27,000 crore.  Thids will have a capacity of 48 million per day for automotive, EVs, consumer electronics, telecom and mobile phones. In partnership with Renesas Electronics Corp and Stars Microelectronics of Thailand, CG Power will set up a unit in Sanand in Gujarat at an investment of ₹7,600 crore. The CG power semiconductor unit will manufacture 15 million chips for consumer, industrial, automotive and power applications.

Commenting on the Cabinet decision, N Chandrasekaran, Chairman of Tata Sons, said that semiconductors will be the most critical building block with AI-led digitisation of every aspect of human existence. By 2030, the global semiconductor industry is expected to grow to $ 1 trillion and Indian semiconductor demand is expected to cross $110 billion. “India’s entry in the semiconductor manufacturing will significantly de-risk global supply chains and make India a significant player in the global semiconductor industry,” he said.

In June last year, the Cabinet approved a proposal of Micron for setting up a semiconductor unit in Sanand, Gujarat. The approvals are part of the Modi government’s ambitions to make India a chipmaker for the world and cutting reliance on countries like Taiwan.

“Within a very short time, India‘s 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,” he said.

These units will accelerate employment creation in downstream automotive, electronics manufacturing, telecom manufacturing, industrial manufacturing, and other semiconductor-consuming industries. “Construction of Micron’s Sanand unit is progressing rapidly and a robust semiconductor ecosystem is emerging near the unit. We hope to start shipment by December this year,” the Minister said.