India’s New Semiconductor Projects

March 15, 2024

Prime Minister Narendra Modi virtually laid the foundation stone for three semiconductor projects worth approximately Rs 1.25 trillion. These projects are set to transform India into a global semiconductor hub, driving economic growth and fostering innovation in the country.

The Three Semiconductor Projects

1 Dholera Special Investment Region (DSIR) in Gujarat

Semiconductor fabrication facility
Investment: Rs 91,000 crore
Expected to commence chip production by 2026
Established by Tata Electronics Private Limited (TEPL) in partnership with Taiwan’s Powerchip Semiconductor Manufacturing Corporation (PSMC)
Powered by renewable energy
Dedicated water supply from Narmada river canal

2 Morigaon, Assam

Outsourced Semiconductor Assembly and Test (OSAT) facility
Investment: Rs 27,000 crore
Developed by Tata Electronics Private Limited (TEPL)
Will cater to electric vehicles, automotive, mobile phones, and power devices

3 Sanand, Gujarat

Outsourced Semiconductor Assembly and Test (OSAT) facility
Investment: Rs 7,500 crore
Set up by CG Power and Industrial Solutions Limited under the Modified Scheme for Semiconductor Assembly, Testing, Marking and Packaging (ATMP)

India’s Semiconductor Mission

All three projects are being incentivised under the India Semiconductor Mission, which has an outlay of Rs 76,000 crore. This mission aims to position India as a prominent global centre for semiconductor design, manufacturing, and technology development.

Employment Opportunities

These semiconductor facilities are expected to generate numerous employment opportunities for India’s youth. The Dholera facility alone is estimated to create around 20,000 skilled jobs, both directly and indirectly. The Morigaon plant is expected to generate 27,000 direct and indirect jobs.

Dholera Plant Details

The Dholera plant, jointly established by Tata Group and Taiwan’s Powerchip Semiconductor Manufacturing Corporation (PSMC), is projected to have its inaugural chip ready for production by the end of 2026. The plant will begin by manufacturing 28 nanometer chips and is expected to have a total capacity of 50,000 wafer starts per month (WSPM).

The chips produced at the Dholera facility will cater to eight broad sectors:

High-power computing
Electric vehicles
Telecom
Defence
Consumer electronics
Automobile
Power electronics

Government Support

Government subsidies from both central and state authorities are anticipated to cover up to 70 per cent of the Dholera project expenses, making it India’s premier commercial semiconductor fab, a longstanding goal of the government.

Partnerships and Collaborations

The Tata Group is actively seeking partnerships with Taiwanese firms for its semiconductor facilities. They are in discussions with UMC Group and Powerchip Semiconductor Manufacturing Corporation for the Dholera plant.

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