Govt Planning Incentives Worth Rs 76,000 Cr Towards Setting Up Chip Fabs: Report

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A few months earlier, Tata’s Chairman N Chandrasekaran revealed that Tata Group is looking to make a foray into semiconductor manufacturing

As India gears itself to make its foray into the chip manufacturing industry, the government is ramping up its support by providing support worth Rs 76,000 crore as incentives towards setting up over 20 semiconductor design, components manufacturing and display fabrication (fab) units over the next six years, a report by ET stated.

A source of the publication said that the target of the government includes one to two fab units for displays, and 10 units each for designing and manufacturing components.

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“Through various PLI (production linked incentive) schemes, the Centre has tried to broaden the scope of manufacturing and export from India while the semiconductor policy will help deepen India’s manufacturing base,” the source, a senior goverment official, added.

Notably, the scheme is likely to go to Cabinet next week for approval and after that, the ministry of electronics & IT (MeitY) would work out the granular details and invite applications.

“…(after the Cabinet approval), the final contours of the policy will be drawn later and advertised, seeking interest from companies to invest,” another official said.

A few months earlier, Tata’s Chairman N Chandrasekaran revealed that Tata Group is looking to make a foray into semiconductor manufacturing.

With the market opportunity of high-tech manufacturing of electronics at $1 trillion, Chandrasekaran said Tata Group has already set up a business to seize the opportunity.

India already has a PLI in existence that promises to reward such ATMP/OSAT units with incentives based on production. Dubbed Scheme for Promotion of Manufacturing of Electronic Components and Semiconductors (SPECS), the scheme was launched in 2020, and promises financial incentive of 25 per cent on capital expenditure for the identified list of electronic goods, i.e., electronic components, semiconductor/ display fabrication units, ATMP units, specialized sub-assemblies and capital goods for manufacture of aforesaid goods.

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