India’s investment in Semiconductor manufacturing
About The Scheme
The Cabinet cleared the Rs 76,000-cr incentive scheme for semiconductors. Under this scheme, India will set up more than 20 semiconductor design, components manufacturing and display fabrication (fab) units over the next six years.
The government has lined up an attractive incentive support for companies engaged in silicon semiconductor fabs, display fabs, compound semiconductors, silicon photonics, and semiconductor packaging
The scheme for setting up of semiconductor fabs and display fabs in India will extend fiscal support of up to 50 per cent of project cost to eligible applicants.
The IT Ministry will explore the possibility for the Joint Venture of SCL with a commercial fab partner to modernize the brownfield fab facility.
Why does the Government want to Invest
There is a global chip shortage which surfaced due to the “Global supply chain imbalance”.
During the pandemic the demand for digital devices increased exponentially. The demand comes from various markets like health care systems, increase in mobile sales during to the lockdown etc.
The vision of National Policy on Electronics 2019 (NPE 2019) is to position India as a global hub for Electronics System Design and Manufacturing (ESDM) and create an enabling environment for the industry to compete globally
With a view to driving the long-term strategies for developing a sustainable semiconductors and display ecosystem, a specialized and independent ‘India Semiconductor Mission (ISM)’ will also be established
In the midst of the semiconductor chip shortage, it’s not just companies, but also countries fighting to ramp up silicon production.
There is a huge potential and India wants to be the early bird amongst the developing nations
Where Do We Stand
With minimal local manufacturing India meets its semiconductor demand through imports spending $24 Billion currently and which is estimated to reach $100 Billion by 2025
India does manufacture chips at a small scale for sensitive areas like defence and space research at fab present within IISc, SCL Mohali, and few others places