The electronics and IT ministry is looking to gear up the domestic semiconductor industry with this multi-million bucks investment.
The Ministry of Electronics and Information Technology (MeitY) is preparing to approve several proposals for OSAT (Outsourced Semiconductor Assembly and Testing) and ATMP (Assembly Testing Marking and Packing) facilities in the upcoming months.
This initiative is supported by the existing allocation of Rs 76,000 crore designated for the flagship Indian Semiconductor Mission (ISM), equivalent to almost 10.13 billion USD.
As stated by a source to Moneycontrol, some approvals will be part of the 100-day agenda. Still, there will be no approval for a semiconductor fabrication facility (fab) due to insufficient funds allocated for such a commitment within the 100-day plan.
According to Moneycontrol, the semiconductor division of Kaynes Technology, known as Kaynes Semicon, is likely to receive approval for its outsourced semiconductor assembly and test (OSAT) unit in Telangana. Several other applicants are also expected to obtain approval from the ministry soon.
As of April this year, the ministry has received seven applications for setting up semiconductor fabs, three for establishing display fabs, and sixteen for compound and ATMP (Assembly, Testing, Marking, and Packing) facilities.
A collaboration between Foxconn Technology Group and HCL Group, as well as another joint venture of ASIP (Advanced System in Package Technologies) and Korea’s APACT Limited, have applied for OSAT facilities.
Tarq Semiconductors, owned by real estate conglomerate Hiranandani Group, has also submitted requests for approval to establish an ATMP facility and a compound semiconductor unit.
According to reports, the government is currently evaluating the need for extra funds under the ISM scheme and may raise the budget if new fab proposals meet approval criteria.
They are assessing all applications to determine the additional funding needed. Within two to three years, the goal is to establish two to three more semiconductor fabrication units in the country.
Ideally, fabs need more funding than OSAT due to advanced technology, higher capital expenditures, infrastructure needs, and operational costs. They involve complex manufacturing processes at smaller nodes, requiring continuous innovation and longer setup times.
The central government launched the ISM in 2021 to support India’s semiconductor manufacturing, packaging, and design units. The scheme provides up to 50% fiscal support for approved applicants concurrently.
