India accelerates semiconductor ambitions with three new manufacturing units

PM Modi laid the foundation stones for India's first pure-play commercial semiconductor chip manufacturing foundry by the Tata Group in Dholera, Gujarat

March 14, 2024

Two outsourced semiconductor and assembly testing (OSAT) units have been initiated in Gujarat, and Assam

Union Minister Ashwini Vaishnaw highlighted the rapid progress, with the foundation stones laid within a record time of 15 days

Significant investments approved by the cabinet include commercial foundry and OSAT units, propelling India's semiconductor capabilities

Tata Sons Chairman N Chandrasekaran anticipates commercial production to commence in late 2025 or early 2026, serving various sectors, including automotive, electronics, and healthcare

Prime Minister Narendra Modi has hailed the establishment of three chip manufacturing and assembly facilities as a pivotal step in positioning India as a global semiconductor hub and elevating its status in the global semiconductor value chain. The Prime Minister laid the foundation stone for India’s maiden pure-play commercial semiconductor chip manufacturing foundry, led by the Tata Group in Dholera, Gujarat.

In addition to the Dholera facility, Modi initiated the groundwork for two OSAT units in Sanand, Gujarat, and Jagiroad, Assam. Addressing the event virtually, Modi expressed confidence in the historical significance of the moment, underscoring its contribution to India’s bright future.

Highlighting the expedited progress, Union Minister for Electronics and Information Technology, Ashwini Vaishnaw, revealed that the foundation stones for the Tata-Powerchip Semiconductor Corp’s semiconductor fabrication unit in Dholera, the Tata Group’s OSAT unit in Assam and the CG Power-Renesas Group’s OSAT unit in Sanand were laid within a record time of 15 days.

Speaking on the significance of this achievement, Vaishnaw emphasised the decades-long endeavour to establish semiconductor manufacturing in India, which was finally realised in 2024. These semiconductor chips, produced in Dholera and the OSAT units, are poised to be integrated into various global products spanning automobiles, mobile phones, and other electronic devices.

Vaishnaw elaborated on the infrastructure support for the Dholera unit, highlighting its reliance on a 30,000 MW hybrid power project, touted as the world’s largest continuous renewable plant at a single location. The cabinet’s approval on February 29 sanctioned significant investments, including Tata-PSMC’s INR 91,000 crore commercial foundry, Tata’s INR 27,000 crore OSAT unit, and the CG Power-Renesas joint venture’s INR 7,600 crore OSAT unit.

With these developments, India now boasts three OSAT units and a pure-play commercial foundry, collectively capable of producing 80 million chips from the OSAT units and initiating 50,000 wafer starts per month from the Dholera foundry.

N Chandrasekaran, Chairman of Tata Sons, hailed this moment as pivotal for India’s semiconductor ambitions, anticipating commercial production from Dholera and Assam to commence in late 2025 or early 2026. These facilities are expected to serve diverse sectors, including automotive, power, electronics, consumer goods, and medical equipment.

Union Minister of State for Electronics and Information Technology, Rajeev Chandrasekhar, noted the transformative impact of these projects on India’s digital economy and technological capabilities. Chandrasekhar said that along with the fabs and OSAT units, the accompanying supply chains would attract ecosystem players, fostering precision industries such as water treatment and gases.

The foundation laying of these projects marks India’s definitive foray into commercial chip fabrication units, a long-standing aspiration. India’s initial strides towards a semiconductor ecosystem began with the approval of an INR 76,000 crore incentive scheme in December 2021, followed by Micron’s announcement in June 2023 to establish an OSAT unit in Sanand, Gujarat, with a total investment of US$ 2.75 billion.

Source: Economic Times

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