Government Readies RFP Seeking Proposals From Companies To Set Up Semiconductor Plants

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  • A senior official directly involved in the matter said said that they have to take final approvals for issuing the RFP
  • The Ministry of Electronics and IT (MeitY) has not revealed the quantum of incentive it would provide companies

As per media reports, the government will soon put out a request for proposal (RFP) document seeking formal applications from companies to set up semiconductor plants, senior officials said. They also said that several companies showed interest earlier this year to set up such fabrication units and that the government would decide on the quantum of subsidy only after it receives specific proposals.

A senior official directly involved in the matter said said that they have to take final approvals for issuing the RFP. It should happen soon. How much support can be given to the companies will be decided after they receive the applications and after discussing with stakeholders on their support requirements. The official added that setting up fabs is expensive and the subsidy is huge, so the government will be “careful” before giving approvals, the official added. They have to see whether the party is genuine, how much money they will be bringing, etc.”

The Ministry of Electronics and IT (MeitY) has not revealed the quantum of incentive it would provide companies. The government is believed to set aside $1 billion for a fab, which requires a total investment commitment of $2 billion-$5 billion or more. The government official said 5G, data centres and semiconductors were the next areas of focus for the government,

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The government is open to setting up both traditional fabs as well as new-age ones like the Gallium Nitride semiconductor fabs, which are relatively cheaper to build. The official said that they are open to both domains, both can come at the same time, depends on the interest that they get from the players.

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