India Accelerates Semiconductor Manufacturing with Three New Units

New Delhi: In a landmark decision, the Union Cabinet has given its nod for the establishment of three semiconductor units under the “Development of Semiconductors and Display Manufacturing Ecosystems in India” initiative. The construction of all three units is set to commence within the next 100 days, marking a significant stride towards bolstering India’s semiconductor manufacturing capabilities.

The ambitious “Programme for Development of Semiconductors and Display Manufacturing Ecosystem in India,” officially notified on December 21, 2021, with a total outlay of Rs. 76,000 crore, underscores India’s commitment to enhancing its prowess in the semiconductor industry. This development follows the Cabinet’s approval in June 2023 for Micron to establish a semiconductor unit in Sanand, Gujarat, paving the way for the emergence of a robust semiconductor ecosystem in the region.

Semiconductor Fab with 50,000 wfsm capacity:
Tata Electronics Private Limited (“TEPL”) is set to establish a semiconductor fab in partnership with Powerchip Semiconductor Manufacturing Corp (PSMC), Taiwan. This high-tech facility, to be constructed in Dholera, Gujarat, represents an investment of Rs. 91,000 crore. PSMC, renowned for its expertise in logic and memory foundry segments, will bring its technological prowess to the venture. The fab will have a capacity of 50,000 wafer starts per month (WSPM) and cover segments such as high-performance compute chips with 28 nm technology and power management chips for various applications, including electric vehicles, telecom, defense, automotive, consumer electronics, display, and power electronics.

Semiconductor ATMP unit in Assam:
Tata Semiconductor Assembly and Test Pvt Ltd (“TSAT”) will spearhead the establishment of a semiconductor unit in Morigaon, Assam, with an investment of Rs. 27,000 crore. TSAT semiconductor, developing indigenous advanced semiconductor packaging technologies, will contribute to segments like automotive, electric vehicles, consumer electronics, telecom, and mobile phones. The unit will boast a capacity of 48 million per day.

Semiconductor ATMP unit for specialized chips:
CG Power, in collaboration with Renesas Electronics Corporation, Japan, and Stars Microelectronics, Thailand, will set up a semiconductor unit in Sanand, Gujarat, with an investment of Rs. 7,600 crore. Renesas, a leading semiconductor company, will lend its expertise in specialized chips for consumer, industrial, automotive, and power applications. The unit will have a capacity of 15 million per day.

Strategic Significance:
These approved semiconductor units represent a significant stride in establishing a robust semiconductor ecosystem in India. They signify the country’s commitment to developing capabilities in chip fabrication, complementing its existing strengths in chip design. The venture will also focus on the development of advanced packaging technologies, furthering India’s self-reliance in this critical sector.

Employment Potential:
The three semiconductor units are expected to generate direct employment for 20 thousand individuals in advanced technology jobs and create around 60 thousand indirect jobs. This move is anticipated to accelerate employment creation in downstream industries, including automotive, electronics manufacturing, telecom manufacturing, and industrial manufacturing.

The establishment of these semiconductor units aligns with India’s vision to become a key player in the global semiconductor industry, contributing to economic growth, technological advancement, and job creation in the country.