Cabinet clears Rs 1.26L cr Semiconductors plants

In a significant step towards reducing dependence on imported chips, the Union Cabinet on Thursday approved the establishment of three new semiconductor fabrication units (fabs) by leading companies with an investment of Rs 1.26 lakh crore. The move comes under the “Development of Semiconductors and Display Manufacturing Ecosystem” program, which offers government support of up to Rs 76,000 crore.

The Cabinet also approved a Rs 24,420 crore subsidy for P&K fertilisers for the upcoming kharif season to ensure farmers continue to buy key soil nutrients like DAP at the same affordable price of Rs 1,350 per bag. The subsidy scheme aims to make fertilisers accessible while reducing reliance on imports.

The Cabinet also greenlighted the PM-Surya Ghar: Muft Bijli Yojana scheme with an investment of Rs 75,021 crore that aims to provide free electricity (up to 300 units) and financial aid (up to Rs 78,000) for installing rooftop solar panels on 1 crore households. Households can register themselves to avail benefits under the scheme.

Meanwhile, giving details about the semiconductor push, Telecom Minister Ashwini Vaishnaw said: “The semiconductor units which will make chips for sectors including defence, automobiles and telecommunications, will begin construction within the next 100 days.”

Tata Electronics Pvt Ltd and Taiwan’s Powerchip Semiconductor will build a Rs 91,000 crore fab at Dholera in Gujarat, producing 50,000 wafers per month.

Vaishnaw said the Dholera plant will produce high-performance compute chips with 28 nm technology for electric vehicles (EV), telecom, defence, automotive, consumer electronics, display and power electronics.

Tata Semiconductor Assembly and est Pvt Ltd (TSAT) will set up a Rs 27,000 crore unit at Morigaon in Assam, with a capacity of 48 million chips per day for automotive, electric vehicles, consumer electronics, telecom, and mobile phones.

CG Power, Japan’s Renesas Electronics Corp, and Stars Microelectronics of Thailand will collaborate on a Rs 7,600 crore facility at Sanand in Gujarat, producing 15 million chips for consumer, industrial, automotive and power applications.

The projects are expected to generate 20,000 direct high-tech jobs and an estimated 60,000 indirect jobs, further boosting employment in related industries.

In June last year, the Cabinet approved a proposal of Micron for setting up a semiconductor unit in Sanand, Gujarat.

This initiative aligns with the Modi government’s ambition to position India as a global chip producer and reduce reliance on imports. It marks a significant step towards achieving self-sufficiency and boosting domestic manufacturing capabilities in a critical sector.

“Within a very short time, India’s semiconductor mission has achieved four big successes. With these units, the semiconductor ecosystem will get established in India. India already has deep capabilities in chip design. With these units, our country will develop capabilities in chip fabrication. Advanced packaging technologies will be indigenously developed in India with today’s announcement,” Vaishnaw said.

Construction of Micron’s Sanand unit is progressing at a rapid pace and a robust semiconductor ecosystem is emerging near the unit, he said.

Tata Electronics’ partner PSMC is renowned for its expertise in logic and memory foundry segments. PSMC has 6 semiconductor foundries in Taiwan. Power management chips the two will manufacture are high voltage, high current applications.

TSAT semiconductor is developing indigenous advanced semiconductor packaging technologies including flip chip and ISIP (integrated system in package) technologies.

Renesas is a leading semiconductor company focussed on specialised chips. It operates 12 semiconductor facilities and is an important player in microcontrollers, analogue, power, and System-on-chip (‘SoC)’ products.