India Invests $15.2B in Three Semiconductor Plants

On February 29th, the Minister of Electronics and Information Technology for India, Ashwini Vaishnaw, announced the approval of three semiconductor fabrication plants with a combined value of INR 1.256 trillion (USD 15.2 billion). Notably, this includes India's inaugural 12-inch wafer fabrication facility, a collaboration between Tata Group and Taiwan's Powerchip Technology Corporation (PSMC), along with two assembly and testing facilities, one by Tata Group and CG Power under Murugappa Group.

The first facility is a semiconductor wafer fabrication plant in Dholera, Gujarat, formed through a partnership between Tata Group subsidiary Tata Electronics and Taiwan's Powerchip Technology Corporation (PSMC). With a total investment of INR 910 billion, construction is set to commence within three months, targeting a monthly production capacity of 50,000 wafers. This facility will encompass several mature technology nodes (28nm, 40nm, 55nm, 90nm, and 110nm), leveraging the collaboration with PSMC to provide cutting-edge technology combinations.

The second facility is an assembly and testing plant in Assam, Northeast India, established by Tata Semiconductor Assembly (a Tata Group subsidiary) in collaboration with Test Pvt Ltd. The total investment for this facility is INR 270 billion, with a daily production capacity of up to 48 million chips.

The third facility is an assembly and testing plant formed through collaboration between CG Power in India, Renesas Electronics in Japan, and Stars Microelectronics in Thailand. With a total investment of INR 76 billion, the daily production capacity is approximately 15 million chips.

Minister Vaishnaw emphasized that these facilities will commence construction within the next 100 days and, upon completion, will play a pivotal role in manufacturing and packaging chips for diverse industries, including defense, automotive, and telecommunications. India's strategic goal is to position itself as a leading electronic manufacturing hub, projecting an annual output value of USD 400 billion by 2025. In 2021, the Indian government sanctioned a USD 10 billion semiconductor incentive program, permitting eligible companies to submit proposals and seek funding.

According to official data from the Indian government, the electronic manufacturing sector in India has witnessed substantial growth, surpassing INR 8.22 trillion over the past decade. In the fiscal year 2013-14, the industry's output amounted to INR 1.804 trillion (USD 29.8 billion), experiencing a remarkable surge to INR 8.2235 trillion (USD 102 billion) in the fiscal year 2022-23, with further anticipated growth to INR 9.5195 trillion (USD 300 billion) by 2026.