India boosts semiconductor manufacturing with three new units

In a significant move to bolster the semiconductor manufacturing ecosystem, the Indian Union Cabinet, led by Prime Minister Narendra Modi, has approved the establishment of three semiconductor units under the ‘Development of Semiconductors and Display Manufacturing Ecosystems in India’. This initiative marks a notable advancement in India’s journey towards becoming a key player in the global semiconductor industry, with all three units slated to commence construction within the next 100 days.

Unprecedented Investment in India’s Semiconductor Sector

The Programme for Development of Semiconductors and Display Manufacturing Ecosystem in India, announced on December 21, 2021, with a total outlay of Rs. 76,000 crore, has now seen further expansion. In June 2023, the Union Cabinet greenlit Micron’s proposal to establish a semiconductor unit in Sanand, Gujarat, a project that is progressing rapidly and catalyzing the formation of a robust semiconductor ecosystem in the vicinity.

Narendra Modi approves three semiconductor units under the ‘Development of Semiconductors and Display Manufacturing Ecosystems in India’

The newly approved units are poised to significantly enhance India’s semiconductor manufacturing capabilities:

Tata Electronics Private Limited (TEPL) and Powerchip Semiconductor Manufacturing Corp (PSMC) Partnership:

Set to be located in Dholera, Gujarat, this semiconductor fab will boast a 50,000 wafer starts per month (WSPM) capacity, with an investment of Rs.91,000 crore. PSMC, known for its expertise in logic and memory foundry segments, will serve as the technology partner. The fab will produce high-performance compute chips and power management chips, catering to sectors like electric vehicles (EV), telecom, defense, automotive, and consumer electronics.

Tata Semiconductor Assembly and Test Pvt Ltd (TSAT) in Assam:

With an investment of Rs.27,000 crore, this unit in Morigaon, Assam, will focus on developing indigenous advanced semiconductor packaging technologies. Targeting a capacity of 48 million units per day, it will support automotive, EVs, consumer electronics, telecom, and mobile phones industries.

CG Power and Renesas Electronics Corporation Partnership in Sanand, Gujarat:

This unit, involving an investment of Rs.7,600 crore, will specialize in chips for consumer, industrial, automotive, and power applications. Renesas, a leader in specialized chips, along with Stars Microelectronics from Thailand, will be the technology partners, aiming for a production capacity of 15 million units per day.

These units represent a significant leap forward for India’s semiconductor mission, highlighting the country’s growing capabilities in chip design and fabrication, along with the development of advanced packaging technologies. The direct and indirect employment potential is substantial, with an estimated 20,000 advanced technology jobs and 60,000 indirect jobs expected to be created. This development is set to accelerate growth in automotive, electronics manufacturing, telecom manufacturing, and other semiconductor-consuming industries.

The strategic establishment of these semiconductor units underscores India’s commitment to enhancing its manufacturing capabilities and reducing dependency on global semiconductor supply chains. This move is a critical step in India’s ambition to become a self-reliant technology hub, promising to reshape the future of its technology sector and position India as a significant player in the global semiconductor market.