Foreign investor for semiconductor fab unit will be announced soon

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Wednesday, 07 August 2013: The government will very soon announce the foreign investor for the construction of the country’s first semiconductor wafer fabrication unit. The government had earlier floated expressions of interest which was meant for investors and technology service providers in the year 2011. It is now in the process of ‘carefully considering’ the proposals before arriving at the final decision.

According to the reports of The Hindu, Ajay Kumar, Joint Secretary in the Department of Electronics and Information Technology stated that the setting up of a fab unit would facilitate the evolution of an ecosystem that would be necessary for manufacturing electronic components.

“Obviously, this is a highly capital-intensive project, and we have to consider many aspects before taking a decision,” he added.

According to an industry source, the cost of setting up a semiconductor fabrication facility would be “anything between $2 billion and $6 billion, depending on the nature of the chips that are to be produced.” In February, Ajay Kumar had stated that before end of March, the department would come up with the decision on the selection of investor.

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New Electronics Policy (NEP) that was presented last year held that the country’s first private fund, under the Electronic Development Fund would be launched within a month. Apart from this, a new centre of excellence at IIT-Mumbai, dealing in internal security, was being set up in association with the private sector. Kumar said that the centre was involved in designing phones that would function efficiently in thick jungles as well as on mine-detection radars.

The Department of Electronics and Information Technology was contemplating a proposal presented by the industry to set up a brownfield electronics manufacturing cluster. This proposal is a part of the NEP at Whitefield in Bangalore.

The Department is also looking at another proposal from IIT-Bangalore for an electronics incubation centre meant for designing and developing hardware.

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