On a significant day marked by the Union Cabinet’s approval of three major semiconductor proposals, Minister of State for Electronics and Information Technology, Rajeev Chandrasekhar, disclosed that the government is currently evaluating an $11 billion fab proposal from Israel’s Tower Semiconductor.
The Union Cabinet, on February 29, greenlit three projects under the government’s $10 billion capex-linked incentive scheme, collectively amounting to investments worth Rs 1.26 lakh crore.
Speaking at a press briefing, Chandrasekhar highlighted Tower Semiconductor’s proposal as one of considerable importance due to its distinct characteristics. He explained that Tower Semiconductor’s plan entails a more extended build-out period and involves the establishment of a significantly larger fab capable of processing 80,000 wafers per month, as opposed to the typical 40,000-wafer capacity. This aspect poses complexities beyond the scope of a conventional six-year scheme.
Chandrasekhar noted that the government has received semiconductor proposals totaling $26 billion, encompassing the recently approved projects, last year’s approval for Micron, and pending considerations. He clarified that this figure excludes proposals in the display segment and those that were rejected.
Among the proposals approved by the Union Cabinet on February 29 is India’s inaugural semiconductor fabrication plant (fab), a joint venture between Tata Electronics and Taiwan’s Powerchip Semiconductor Manufacturing Corp. (PSMC) slated for construction in Gujarat’s Dholera with an estimated investment of Rs 91,000 crore. Additionally, Tata Semiconductor Assembly and Test Pvt Ltd (TSAT) will establish a semiconductor unit in Morigaon, Assam, while CG Power, in collaboration with Renesas Electronics Corp., Japan, and Stars Microelectronics, Thailand, will set up a semiconductor assembly, testing, marking, and packaging unit in Sanand, Gujarat.
Chandrasekhar emphasized the significance of these investments, noting that all approved proposals align with the government’s criteria, focusing on companies directly engaged in semiconductor manufacturing or with licensing agreements from foundries.
He further projected India’s rise as the largest semiconductor consumer after China and North America, citing China’s semiconductor consumption last year, estimated at approximately $600 billion.
