India has approved a $10 billion (approximately Rs. 76,090 crore) stimulus plan to attract semiconductor and display manufacturers, Technology Minister Ashwini Vaishnaw said on Wednesday, as part of a deeper push to establish the country as a global hub. for the production of electronics.
Under the plan, the government will provide fiscal aid of up to 50% of project costs to eligible display and semiconductor manufacturers, the government said in a statement.
Israel’s Tower Semiconductor, Taiwan’s Foxconn and a consortium from Singapore have expressed interest in setting up chip factories in India, while the Vedanta Group was keen to set up a display factory, a government source told Reuters.
Tower, Foxconn and Vedanta did not immediately respond to requests for comment.
“The program will usher in a new era in electronics manufacturing by providing a globally competitive incentive package to semiconductor, display manufacturing and design companies,” the government statement said.
The drive comes as some companies want to diversify their manufacturing bases outside of China due to the ongoing trade war between Washington and Beijing and is a sign that India is trying to move up the electronics value chain.
The government’s plan to boost semiconductor manufacturing also comes at a time when automakers and tech companies around the world are grappling with a global chip shortage. The government also approved an incentive plan to support 100 local companies working on integrated circuits and chipset designs.
Technology Minister Ashwini Vaishnaw told a news conference that the plan would help develop “the complete semiconductor ecosystem – from the design of semiconductor chips to their fabrication, packaging and testing in the country”.
‘ADVANCED TECHNOLOGY’
The government said it expected the scheme to create about 35,000 high-quality jobs, attract 100,000 indirect jobs and investment worth Rs. 1.67,000 crores.
Prime Minister Narendra Modi’s government has offered about $30 billion (approximately Rs. 2,28,280 crore) in incentives to persuade some of the world’s largest electronics manufacturers to locate in India and boost the domestic industry. to give.
The push has already helped make India the second largest smartphone maker in the world after China.
It has also helped India win investment commitments from Foxconn, Wistron and Pegatron – three of Apple’s top contract manufacturers.
“The government’s plan will help bring advanced technology, more jobs and greater investment to India,” said A Gururaj, director of Indian contract manufacturer Optiemus Electronics. “It will also help reduce expensive technology imports.”
Tata Group, one of India’s largest conglomerates, is venturing into the semiconductor industry and is in talks with three states to invest up to $300 million (about Rs. 2,280 crore) to set up a chip assembly and testing unit, reported Reuters last month.
© Thomson Reuters 2021