Govt may clear semiconductor plant proposals in next 30-60 days

The government is expected to approve proposals to set up electronic chip and display manufacturing units across the country in the next 30 to 60 days, Union Minister for Electronics and IT Rajeev Chandrasekhar has said.

Addressing an event on Wednesday, Chandrasekhar said the country’s semiconductor ecosystem has seen an impressive growth in the past eight to nine months with the government receiving proposals from at least five companies to set up electronic chip and display manufacturing plants at an investment of ₹1.53 lakh crore.

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The minister said companies Vedanta Foxconn JV, IGSS Ventures, ISMC have proposed to set up electronic chip manufacturing plants at an investment of $13.6 and have urged the government to provide $6.5 million under the ₹76,000 crore Semicon India Programme.

“Over the next couple of months, I think over next 30 to 60 days…government of India and India Semiconductor Mission will be rolling out those proposals that have been scrutinized and that have passed the investment,” Chandrasekhar said.

He said several companies have showed interest in investing in the sector and the government has received proposals for investment in water fabrication plants, and manufacture of silicon compounds among others.

“State governments have shown some tremendous amount of alacrity. State governments like Gujarat, Karnataka have shown tremendous proactive response to looking at this very new opportunity, an opportunity for growth, and job creation, investments and innovation,” he said.

Vedanta Foxconn JV has announced plans to set up an electronic chip manufacturing unit in Gujarat. He said there is significant investment required in the semiconductor space and the government is looking at this sector as a long game.

“This year alone, we will cross over USD 15 billion of exports where at one point we were having zero exports in 2014. Our target for electronics as an overall sector is USD 300 billion of manufacturing by 2025 and exports of USD 120 billion,” Chandrasekhar said.

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Citing a study, India Electronics and Semiconductor Association (IESA) Chairman Vivek Tyagi said India will consume roughly USD 27 billion orth semiconductors in 2022.

“This consumption of semiconductors will grow to roughly USD 70 billion by 2026. It sounds like a big market but only 10 per cent of those USD 27 billion semiconductors were actually procured in India. That’s a cause of concern and as an IESA and industry we all need to work to improve the situation. This can be improved if we focus on electronics system design and manufacturing in India,” Tyagi said.

He said the government’s incentives have given a push to the electronics sector but most of the products are getting assembled in India.

“Once the products get designed here…there will be a different level of value addition that will happen in the country ,” Tyagi said.

Also read: ISMC to set up Rs 22,900 cr semiconductor fab plant in Karnataka

He said before the start of semiconductor manufacturing there is a strong case of assembly and testing of electronic chips in India.

(With inputs from agencies)