The government is keen to widen the scope of incentives under India Semiconductor Mission (ISM) to cover display fabrication companies, raw material suppliers, gas suppliers and chip packaging companies
The Centre aims to attract more investments in the semiconductor sector from different sub-sectors, as extending sops only to set up fabs or OSAT units wouldn’t “suffice”, said Akash Tripathi, chief executive of ISM
The Centre is also looking to increase the budget of the INR 76,000 Cr scheme since sops worth INR 60,000 Cr have already been allocated
In an effort to strengthen India’s position in the global semiconductor ecosystem, the Centre is considering expanding the scope of India Semiconductor Mission (ISM).
The government is keen to widen the scope of incentives under the scheme to cover display fabrication companies, raw material suppliers, gas suppliers and chip packaging companies and other vendors in the semiconductor ecosystem, Akash Tripathi, the chief executive of India Semiconductor Mission, was cited as saying by Moneycontrol.
The Centre aims to attract more investments in the semiconductor sector from different sub-sectors, as extending sops only to set up fabs or outsourced semiconductor assembly and test (OSAT) units wouldn’t “suffice”, Tripathi said.
The Centre has received proposals from 20 such companies seeking sops under the India Semiconductor Mission, he added. The Centre is also reportedly looking to increase the budget of the India Semiconductor Mission since sops worth INR 60,000 Cr have already been allocated under the scheme.
It is pertinent to note that the Centre launched the Semicon India programme in 2021 with a total outlay of INR 76,000 Cr. In 2022, the India Semiconductor Mission was launched with an aim to build a vibrant semiconductor and display ecosystem in the country.
The government plans to extend support to players in the semiconductor ecosystem directly for 10 years under the scheme.
Additionally, the Centre is also examining the proposal of Israel’s Tower Semiconductor to set up a chip fabrication facility in the country. While the Maharashtra government recently approved Tower Semiconductor-Adani Group’s joint proposal to invest INR 83,947 Cr in the state for the unit, the Centre is awaiting details from the joint venture.
Tower Semiconductor’s proposal is currently at the appraisal stage.
While formulating the India Semiconductor Mission, the government had envisaged double-digit overall fabs in the country, including 2-3 semicon fabs, 2-3 display fabs and several compound semiconductor fabs, Tripathi said.
The development comes at a time when India is ramping up efforts to position itself as a semiconductor hub. The government has already approved five semiconductor plants under the India Semiconductor Mission, which are expected to bring in investments worth INR 1.52 Lakh Cr.
Last week, the union cabinet approved the proposal of Kaynes Semicon to set up a semiconductor unit in Gujarat with an investment of INR 3,300 Cr.
In an effort to diversify the existing semiconductor supply chain and reduce reliance on China, India and the US have also joined hands to explore more growth opportunities in the sector.
Meanwhile, tech giant Apple is also reportedly in talks with Micron and the Tata Group to source made-in-India chips for its iPhones, providing a further boost to India’s ambitions to become a global semiconductor hub.
India is currently home to over 100 semiconductor startups and the country’s semiconductor industry is expected to become a $150 Bn opportunity by 2030 from $33 Bn in 2023, as per Inc42.
