Big Push to Design, Make Semiconductor Chips in India Gets Cabinet Nod

Union information and broadcasting minister Anurag Thakur said the scheme envisages the investment of ₹76,000 crore in the semiconductor production over the next five-six years.

The Union cabinet on Wednesday approved a budget of ₹76,000 crore for a production linked incentive (PLI) scheme for semiconductor and display board production in the country. 

Union telecom and IT minister Ashwini Vaishnaw said the entire ecosystem starting with the design and manufacture of the semiconductor chips will be developed in India.

Union information and broadcasting minister Anurag Thakur said the scheme envisages the investment of ₹76,000 crore in the semiconductor production over the next five-six years. The ambitious project is named Programme for Development of Semiconductors and Display Manufacturing Ecosystem.

The government said the project will have a multiplied effect across different sectors and will help in deeper integration to the global value chain.

It would contribute significantly towards achieving $5 trillion dollar economy and $5 trillion GDP (gross domestic product) by 2025.

The programme will usher in a new era in electronics manufacturing by providing a globally competitive incentive package to companies in semiconductors and display manufacturing as well as design, the government said.

Vaishnaw said, “…Prime minister Narendra Modi has taken a historic decision today that will help develop the complete semiconductor ecosystem — from the design of semiconductor chips to their fabrication, packing and testing — in the country.”

A Reuters article said, quoting sources, companies, including Israel’s Tower Semiconductor, Apple’s contract manufacturer Foxconn and a Singapore-based consortium have shown interest in setting up semiconductor fabrication units in India. The Vedanta Group was also keen to set up a display fabrication plant in the country, it said. 

The cabinet decision comes at a time when automakers and tech companies are grappling with a global semiconductor shortage.