New trends in India's semiconductor strategy: subsidies attract Taiwan to visit India to invest in plant expansion

In India's efforts to build a local semiconductor supply chain, a Taiwanese delegation of semiconductor manufacturers is reportedly planning to visit India for semiconductor cooperation.

The "Hindustan Times" quoted people familiar with the matter as saying that after India visited Taiwan twice in 2021 to discuss semiconductor cooperation, Taiwanese delegations such as TSMC and UMC will visit India in the next few weeks.

The report quoted sources as saying that the Indian side has identified the location of the manufacturing unit with sufficient land, semiconductor-grade water and high-quality power supply. India will also provide financial support up to 50% of the project cost.

In 2021, Bloomberg also cited sources as saying that Taiwan and India are discussing a $7.5 billion chip factory. India will help find a suitable location for the plant and provide 50% of capital expenditures from 2023, along with tax breaks and other incentives.

India announced a 760 billion INR ($10 billion) investment incentive program for semiconductor and display fabs in December 2021. It is backed by multinational companies such as ISMC, IGSS Ventures and Foxconn, which have chosen to set up a fab in southern India.

However, according to the Economic Times, India has decided to indefinitely extend the application period for a $10 billion plan for potential future investments from TSMC, Intel and Samsung Electronics.

According to SME Futures, the Indian Electronics and Semiconductor Association released a report predicting that India has an $85 billion opportunity in the global $500 billion semiconductor manufacturing supply chain market.