Govt invites proposals for setting up semiconductor FAB plants in India

Keen to incentivise and attract investments for setting up of semiconductor FABs in India, the government has issued Expression of Interest (EoI) for setting up/expansion of existing semiconductor wafer/ device fabrication (FAB) facilities in the country or even acquisition of semiconductor FABs outside India. Setting up semiconductor FAB facilities and its ecosystem was one of the main strategies of the National Policy on Electronics 2019 (NPE 2019) that aims to position India as a global hub for Electronics System Design and Manufacturing (ESDM).

Semiconductors are used in the majority of electronic products today and constitute to be a significant part of the total value of Bill of Material (BOM). Defined by rapid changes in technology, semiconductor manufacturing is a complex and research-intensive sector, requiring heavy investment. With the government's focus on Make in India, there has been a significant increase in electronics manufacturing in the country. And from assembly in India, it is steadily moving up the value chain from Semi Knocked Down (SKD) to Completely Knocked Down (CKD) stage of manufacturing. Yet, the domestic value addition is estimated to be in the range of 15-20 per cent only due to the lack of a robust electronic components and semiconductor manufacturing ecosystem in India.

According to the EoI document, Government of India is keen to incentivise and attract investment in setting up of Semiconductor FABs in India. This assumes significance in view of the fact that India is poised to increase its share in global manufacturing of Mobile Phones, IT Hardware, Automotive Electronics, Industrial Electronics, Medical Electronics, IoT and other devices in the near future as it aspires to have $400 billion of electronics manufacturing by the year 2025.

The government has formulated three categories under which the EoI may be submitted. The category A includes well established Integrated Device Manufacturers (IDMs) or Foundries or Indian Company/Consortia with Indian Industry Partner - having state-of-art mainstream CMOS technology nodes for fabricating processors, memories, analog / digital / mixed signal Integrated Circuits. And are keen on setting up/expansion of existing semiconductor FAB in India (preferably with a node size of 28nm or lower, wafer size of 300 mm and capacity of 30,000 WSPM or more). The category B includes well established IDMs or Foundries OR Indian Company/Consortia with Indian Industry Partner having state-of-art compound semiconductor-based emerging technologies for fabricating high frequency/ high power/optoelectronics devices, and keen on setting up /expansion of existing semiconductor FAB in India preferably with wafer size of 200 mm or more. The category C includes Indian Companies /Consortia interested in the acquisition of Semiconductor FAB outside India. Along with the category, the proposals need to have details of the land location, land, water and power requirement, operation details, financial details, financial support desired by the government, technology specifications, operational details, among others.

January 31, 2021, is the last date for the submission of proposals, and the government might use the information received in response of this EoI to formulate a Scheme for setting up, expansion of existing semiconductor facilities in the country or acquisition of Semiconductor FABs outside India.

Also Read: Global cost of coronavirus: $11.7 trillion

Also Read: COVID-19 slows auto industry by 4 years; full recovery seen by 2024

Also Read: Cabinet approves next round of spectrum auction