According to persons in the know, India is prepared to take a $3 billion investment from US semiconductor maker Micron in order to build an OSAT facility—an outsourced semiconductor assembly and test facility—with at least four production lines.
According to insiders, the Idaho-based corporation would initially spend around $2.5 billion, with more investments expected to be made over five years.
This would be the first time the national government has approved an OSAT facility, also known as an Assembly Testing Marking and Packaging (ATMP) unit, as part of a Rs 76,000 crore package to begin semiconductor production in the country.
“There have been several rounds of discussions between the board of directors of Micron and government officials. The Micron board has been asked for details of its planned investment, the capacity it wants to create, and the government help it wants so that the process can be expedited,” according to an official aware of the details.
ATMP/OSAT units are critical components in the semiconductor production chain because they test and pack silicon chips.
These units typically need up to $5 billion in investment, as opposed to semiconductor fab units, which require investments ranging from $10 billion to $15 billion. According to those familiar with Micron’s proposal, it was originally presented to the expert group entrusted with approving projects under the India Semiconductor Mission (ISM) in March of this year. The deadline for submitting ideas in the ATMP/ OSAT category is December 2024.
“The committee has liked the proposal submitted by them (Micron). There is some additional last-minute due diligence being done right now. It is a rigorous process as a lot of public money is involved. The proposal is under consideration and may be approved soon,” a senior government official told ET on Friday.
Micron India did not answer inquiries about the planned investment and if the Indian government had requested extra information from the business to speed clearance.
The 1978 Idaho, USA-based company Micron operates three businesses in India: one in Bengaluru and two in Hyderabad. According to reports, the company’s desire to diversify its supply chain in the nation is also likely a response to China’s partial ban on it.
