India Increases Incentives For Setting Up Plants For Semiconductor And Display Manufacturing: Report

In a bid to woo display and chipset-making companies, the Indian government has announced increasing financial incentives for setting up manufacturing units under a $10 billion incentive plan. The move is said to be the government’s push to make India a key player in the supply chain globally, the media has reported.

The central government would bear half the cost of setting up all semiconductor manufacturing units, under the plan, it said in a statement on Wednesday, according to a report by news agency Bloomberg. Earlier, the government had said that it would offer fiscal support ranging between 30 per cent to 50 per cent of a project’s cost depending on the type of processor manufactured.

Earlier this month, metals conglomerate Vedanta and Taiwan-headquartered contract manufacturer Foxconn inked a deal to invest 19.5 billion in the state of Gujarat to set up chipset and display manufacturing plants. Vedanta and Foxconn signed a Memorandum of Understanding (MoU) with the Gujarat government on Tuesday to set up a semiconductor and display FAB manufacturing unit in the state.

The MoU was signed in the presence of Minister for Railways, Communications, Electronics & Information Technology, Ashwini Vaishnaw, at an event held in Gandhinagar. Both the firms would invest Rs 1.54 lakh crore to set up the facility in Gujarat which would create one lakh job opportunities, Gujarat Chief Minister Bhupendra Patel had said on the occasion. Patel also said his government will provide cooperation to set up the facility and to make it a success.

According to a news release by the Department of Science and Technology, the proposed investment for setting up of India’s first display manufacturing fab unit and an integrated semiconductor fab unit with an OSAT facility will further support the development of upstream and downstream electronics manufacturing clusters and establishing healthy trade linkages.

It should be noted that ISMC and Singapore-based IGSS Ventures have already announced setting up chip-making plants in the southern states of Tamil Nadu and Karnataka.