In a historic move, the Union Cabinet has given its nod for India’s inaugural semiconductor fabrication plant, a collaboration between Tata Group and Taiwan’s Powerchip Semiconductor Manufacturing Corp (PSMC). The semiconductor fab, spearheaded by Tata Electronics Pvt Ltd (TEPL), is set to be established in Gujarat’s Dholera with a formidable capacity of 50,000 wafers per month.
IT Minister Ashwini Vaishnaw announced that the net investment for this groundbreaking semiconductor venture would amount to INR 91,000 crore. The TEPL facility will be geared towards producing 50,000 wafers, translating to 2.5 lakh chips per month. These chips will serve diverse sectors, including high-power computing, electric vehicles (EV), telecommunications, defense, consumer electronics, automobiles, and power electronics.
In addition to TEPL’s semiconductor fab, the Cabinet has greenlit two other semiconductor proposals. Tata Semiconductor Assembly and Test Pvt Ltd (TSAT) will establish a chip assembly and testing unit in Assam, with an investment of INR 27,000 crore. Simultaneously, CG Power and Japan’s Renesas will collaborate to set up a semiconductor plant in Gujarat’s Sanand, projecting a cost of INR 7,600 crore and a daily production capacity of 15 million chips.
The collective investment for these three groundbreaking semiconductor projects is estimated at INR 1.26 lakh crore. Construction at all three plants is expected to commence within the next 100 days.
The Indian government’s commitment to fostering self-reliance in the semiconductor ecosystem is evident through these approvals. The Semicon India program, with an outlay of INR 76,000 crore, has been instrumental in developing the semiconductor and display manufacturing ecosystem.
While Tata Group has taken the lead in semiconductor manufacturing, reports suggest that Reliance Industries Ltd (RIL) is exploring potential ventures into semiconductor production.
Speaking on the industry’s progress, Union Minister of State for Electronics and IT Rajeev Chandrasekhar highlighted India’s attractiveness, receiving more than INR 2.50 lakh crore in investment proposals from global chip makers. Chandrasekhar emphasized the nation’s rapid advancement from the absence of a semiconductor ecosystem to becoming a preferred destination for major global investments, showcasing significant capacities in manufacturing, design, and systems.
Notably, the government has received four proposals for semiconductor manufacturing plants and 13 for chip assembly units. This momentum is bolstered by the INR 22,516 crore chip assembly plant established by US-based memory chip maker Micron in Gujarat.
The government’s initiatives have also fueled the growth of semiconductor startups in the country. From 21 startups at the beginning of 2023, Chandrasekhar anticipates the number to reach 50 by the year’s end.
