Wednesday, June 21, 2023

Government approves a chip project investment from Micron of Rs 22,000 crore

 Delhi, India: The union cabinet approved a Rs 22,500 crore (2.7 billion) investment by American chipmaker Micron to establish a semiconductor unit in the country prior to PM Narendra Modi's visit to the United States.

One of the most important jobs in chip manufacturing, Micron plans to establish a semiconductor testing and packaging unit in the country. Micron is one of the world's leading semiconductor manufacturers.

Modi is expected to make the announcement while he is in the United States, where he is scheduled to meet with Sanjay Mehrotra, the CEO of Micron. Over 5,000 jobs are anticipated to be created by the facility.

According to a source, "Micron's proposal has been cleared by the Union Cabinet" and "we expect that the decision will not only help strengthen India’s bid for setting up a wholistic semiconductor eco-system in the country, but will also help attract new players to look at the country favorably." The decision will also help attract new players to the country.

Although the location of Micron's unit has not yet been confirmed, Gujarat is still thought to be a strong contender for the coveted project.

India, which is not only a major consumer but also one of the world's largest electronics and automobile producers, has long felt the absence of a semiconductor ecosystem in the country. This occurs at a time when semiconductor investments are being sought worldwide, particularly given the tensions Taiwan, one of the major chip manufacturers, is experiencing with China.

Since there is currently no unit in India that manufactures semiconductor fab, the government announced an incentive package worth Rs 76,000 crore in December 2021 to attract companies in the technologically advanced industry.

Despite the fact that Vedanta and Taiwanese contract manufacturer Foxconn had jointly proposed the incentive plan, it had not been implemented immediately. But the proposal hasn't come to fruition yet because the two companies haven't been able to find a technology partner.

Intel, GlobalFoundries, Samsung, and Taiwanese semiconductor manufacturer TSMC have all expressed interest in investing in India. Despite their belief in India's long-term potential as a business market, the majority of businesses are already expanding across continents and have taken a wait-and-see approach.

In addition, India has stated that it will develop 100 semiconductor design startups by the end of the next year in order to strengthen the technology's ecosystem while it awaits semiconductor investments.

Recently, Minister of State Rajeev Chandrasekhar stated that India is well on its way to having 100 start-ups in semiconductor design by 2024, up from near zero levels just a year and a half ago. Presently upwards of 27-30 plan and semiconductor new businesses are "accomplishing awesome work", he added.

Chandrasekhar, who is Minister of State for Electronics and IT, stated that India's role in the future of technology, the global supply and value chain, and the innovation ecosystem "is firmly established," citing global companies like Apple, Cisco, and Samsung that have deepened their commitments to India.

In addition, the government is collaborating with prestigious Indian universities to create a pool of talent for the semiconductor industry.

The government maintains its belief that the rise in the production and consumption of automobiles, smartphones, IoT, and other electronic devices will result in a surge in domestic demand for semiconductors, attracting the attention of some of the industry's most prominent manufacturers.

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