The Union Cabinet, chaired by Prime Minister Narendra Modi, recently approved the proposal of Kaynes Semicon Pvt Ltd to set up a semiconductor unit in Sanand, Gujarat with an investment of Rs 3,300 crore. This unit will have a capacity of producing 60 lakh chips per day for a wide range of applications, including industrial, automotive, electric vehicles, consumer electronics, telecom, and mobile phones. The total outlay for the Programme for Development of Semiconductors and Display Manufacturing Ecosystem in India is Rs 76,000 crore, with the aim of developing a vibrant semiconductor ecosystem in the country.
The construction of semiconductor units in Sanand, Gujarat is progressing rapidly, with Tata Electronics and CG Power also setting up semiconductor fabs in Dholera, Gujarat and Morigaon, Assam respectively. The combined investment from these units is expected to be around Rs 1.5 lakh crore, with a cumulative capacity of 7 crore chips per day. The commercial production of semiconductor chips at the Tata Group’s plants in Gujarat and Assam is scheduled to begin in 2026, marking a significant step towards indigenous manufacturing in the semiconductor sector.
Micron, an American chip maker, is also in the process of setting up a high-end semiconductor fabrication plant in Sanand, Gujarat, which is expected to be operational by late 2024. India’s focus on developing a robust semiconductor ecosystem comes in the wake of chip shortages during the Covid pandemic, highlighting the need for indigenous manufacturing to ensure national security and promote innovation. With approximately 70 percent of semiconductor manufacturing capacity concentrated in a few countries, India aims to become a global power in the semiconductor sector through initiatives like the PLI schemes and Atmanirbhar Bharat.
Prime Minister Narendra Modi envisions India becoming a global leader in semiconductor manufacturing, similar to its achievements in technology, nuclear, and digital spaces. The government’s focus on Atmanirbhar Bharat and Make in India initiatives has led to the launch of production incentive schemes in various sectors, including electronics, to boost Indian manufacturers’ global competitiveness, attract investments, enhance exports, integrate India into the global supply chain, and reduce dependency on imports. The development of semiconductor units in Gujarat and Assam is a significant step towards achieving these goals and establishing India as a key player in the semiconductor industry on the global stage.
