Approval to chip makers likely in 6-8 months: Ashwini Vaishnaw

India plans to give its blessing within six to eight months to deserving chipmakers to set up their factories in the country and will offer more incentives down the road to those investing in the sector.

Asia’s No. 3 economy unveiled a Rs 76,000-crore scheme last year to boost semiconductor manufacturing. It has mostly failed to attract chipmakers in the past two decades due to factors including poor infrastructure, unreliable power and red tape.

"After this first tranche gets utilised, we definitely will go for more," IT minister Ashwini Vaishnaw said at India's first semiconductor conference in Bengaluru on Friday. "We have (an) appetite for more, we have (a) need for more."

Vaishnaw said that the government was serious about making India the global hub of the global semiconductor manufacturing ecosystem.

He expects the Indian semiconductor market to reach $80 billion by 2025 and $110 billion by 2030 and sees the scheme generating 1.35 lakh jobs in the next four years.

The India Semiconductor Mission, which has been set up as a dedicated institution for the Semicon India Programme, has received five applications for semiconductor and display fabs with a total investment worth Rs 1.53 lakh crore. In a race to become India's first chip maker, Vedanta Ltd is seeking 1,000 acres of free land from states and other incentives for its foray into semiconductor and display manufacturing, sources told Reuters recently. It has joined hands with Taiwan's Foxconn. Singapore's IGSS Ventures and ISMC, a joint venture between Abu Dhabi-based Next Orbit Ventures and Israel's Tower Semiconductor, and Elest have also sought incentives under the production-linked programme.

Some analysts said the government’s hesitation to divulge more details implied that it hasn’t received proposals for the entire scheme amount.

Kulraj Ashpnani, Principal, Dhruva Advisors LLP, says that though the proposed investment pattern reflected that India was getting traction to be a semiconductor manufacturing hub, "it is likely that the government will open another round of application window for the PLI scheme".

In a recorded clip, Prime Minister Narendra Modi emphasised that India was well-positioned to be an influential player in the semiconductor manufacturing world owing to its consumer base and skilled engineering workforce.

"We aim to engage with stakeholders to understand what more can be done to build a vibrant semiconductor ecosystem," said Modi, who inaugurated the event virtually.

Watch the latest DH Videos here: