Indian government will provide chip fabs a 50% incentive for producing semiconductors

Semiconductor Manufacturing in India: Government to Provide 50 Percent Incentive for Chip Fabs

The proposal to offer a 50% financial incentive for the production of semiconductor fabs in technological nodes as well as compound semiconductor, packaging, and other chip facilities was accepted by the Union Cabinet on Wednesday, which is presided over by Prime Minister Narendra Modi.

The “Programme for Development of Semiconductor and Display Manufacturing Ecosystem in India” was amended with approval from the Cabinet.

A standard financial contribution of 50% of the project cost will be made available across all technological nodes under the revised programme for the establishment of semiconductor fabs.

The redesigned programme will additionally offer financial support of 50% of capital expenditure in compound semiconductors, silicon photonics, sensors, discrete semiconductor fabs, ATMP, and pari-passu mode due to the special technology and nature of compound semiconductors and advanced packaging. OSAT, in line with Official Declaration It was made public following the Cabinet meeting.

Numerous international semiconductor companies have established fabs in India as a result of this scheme. The updated scheme will hasten investment in India’s semiconductor and display industry. The first semiconductor facility’s development is anticipated to start shortly based on conversations with prospective investors.

The India Semiconductor Mission, the program’s key organisation for the development of India’s semiconductor and display manufacturing ecosystem, has an Advisory Committee made up of international specialists from business and academia.

The Government has adopted the Advisory Committee’s unanimous recommendation to provide equal assistance for all Silicon Semiconductor Fabs, Silicon Photonics Fabs, Sensors Fabs, Discrete Semiconductor Fabs, and ATMP/OSAT technology nodes.

Automotive, power, and telecom applications are driving a strong demand for technology nodes of 45 nm and higher. Furthermore, according to a statement from the Ministry of Electronics and IT, this market sector represents close to 50% of the whole semiconductor industry.


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