PC: The Economic Times
The Indian Semiconductor Mission is all set for a big financial boost. Reports are doing the rounds that funding for the same will be increased by a whopping $10 billion. This development has been reported following the approval of setting up a joint semiconductor fabrication unit by Tower Semiconductor and Adani Group by the Maharashtra government.
The recent Maharashtra government nod to the Tower-Adani semiconductor fabrication unit is a defining moment for the ISM. With an estimated investment of ₹83,947 crore, this project will become an important driver for taking India’s semiconductor capabilities to the next level. To be implemented in two phases, Phase 1 will get ₹ 58,763 crore and Phase 2 ₹ 25,184 crore, with expectations of generating 5,000 jobs and producing 80,000 wafers per month.
The addition of this additional $10 billion becomes very important at a time when the central government is reviewing different projects, including the newly sanctioned semiconductor facility. This is important because the previously allocated funds of $11 billion have been used up, hence the need for an additional fund injection.
Funding for the Indian Semiconductor Mission has followed a well-planned but high-on-outlay trajectory. Soon after launching in December 2021, ISM started offering the ₹76,000 crore Chip Incentive Scheme, backed by a 50% subsidy on capital expenditure to set up plants. The interim budget of February 2024 allocated ₹6,903 crore more to the mission.
By March 2024, which was one year from the announcement of the scheme, the ISM had already covered huge strides. Three big projects had already received sanction under the scheme. These included CG Power’s ₹7,600 crore chip packaging facility in Sanand of Gujarat with Japan’s Renesas Electronics; Tata Group’s ₹27,000 crore chip assembly plant in Assam and Tata Electronics’ ₹91,000 crore plant to be set up along with Taiwan-based Powerchip in Gujarat.
The Tower-Adani semiconductor plant in Maharashtra has been given its clearance and received a funding boost. This attempt shows the firmness of the government to give a fillip to the semiconductor industry in India. Stating job creation and enhancement in the capability of semiconductor manufacturing, this move is sure to place Maharashtra among the leading contributors within the global expanse of the semiconductor scenario.
As India surges forward with its semiconductor manufacturing and technologies, the signing of $10 billion towards the Indian Semiconductor Mission is a significant milestone in the country’s journey to emerge as a key player within the semiconductor industry. The strategic investments and collaborative efforts undertaken through the ISM provide key impetus for innovation, job creation, and economic growth within the semiconductor sector.
