The Union Cabinet on Wednesday approved a comprehensive Rs 76,000 crore ($10 billion) incentive package for the much-needed semiconductor and display fab in the country. According to a government statement, the new incentive took the total amount of incentives for the electronic sector to Rs 2.30 lakh crore. The incentives will be extended to a new range of units- greenfield chip fab and display fab units, apart from compound semiconductor and ATMP (assembly, testing, marking, and packaging) facilities.
The statement mentioned that the comprehensive programme for the “development of sustainable semiconductor and display ecosystem in the country” was aimed at making India a global hub of electronic system design and manufacturing.
“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 stated.
The scheme will offer financial support of up to 50% of the project cost to eligible companies that have the technology and capacity to execute such high capital and resource incentive projects for setting up semiconductor and display fabs. The government is planning to set two such fabs. Moreover, the centre will work with the States in setting high-tech clusters with necessary infrastructure such as land and water of semiconductor-grade, the government added. The government will also offer financial support of up to 30% of capital expenditure to the approved units that will set up compound semiconductor units (which make chips for mobile chargers, electric vehicles, and telecom radios) and ATMP facilities. Atleast 15 such units of Compound Semiconductors and Semiconductor Packaging are expected to be established with Government support under this scheme.
“In order to drive the long-term strategies for developing a sustainable semiconductors and display ecosystem, a specialised and independent ‘India Semiconductor Mission’ will be set up. The India Semiconductor Mission will be led by global experts in semiconductor and display industry. It will act as the nodal agency for efficient and smooth implementation of the schemes on semiconductors and display ecosystem,” the statement read.
“The approved programme will propel innovation and build domestic capacities to ensure the digital sovereignty of India. It will also create highly skilled employment opportunities to harness the demographic dividend of the country,” the statement said.
Electronics and Information Technology Minister Ashwini Vaishnaw said while addressing to press that electronics manufacturing in India had increased to $75 billion in the past seven years and is expected to reach $300 billion in the next six years. He also added that the programme “chips to start-ups” will give the opportunity to Semiconductor designers to launch start-ups. The government would bear 50% of the expense under the design-linked incentive scheme. This would develop 85000 well-trained engineers. 35000 high-quality and 1 lakh indirect jobs would be created in the entire scheme.
Anurag Thakur said the decision was expected to attract an investment of Rs 1.67 lakh crore and lead to production worth Rs 9.50 lakh crore.
