India Makes $10B Bid To Grow Local Semiconductor Industry To Serve – And Challenge – The World

India has unveiled a $10 billion subsidy scheme designed to lure semiconductor manufacturers to its shores.

The India Semiconductor Mission (ISM) targets entities seeking to establish "Silicon Semiconductor Fabs, Display Fabs, Compound Semiconductors/Silicon Photonics/Sensors (including MEMS) Fabs, Semiconductor Packaging (ATMP/OSAT), Semiconductor Design."

The Rs.76000 crore ($9.96B) Mission offers construction subsidies for organisations willing to build the above in India. Fabs and design initiatives can receive up to 50 per cent subsidies for their activities. Other semiconductor industries will receive smaller rebates.

India's subsidies may not buy it a lot. Samsung is spending $17 billion on a single fab in Texas, Intel has commenced a $20 billion expansion of its Arizona facilities, and TSMC has flagged capital expenditure approaching $100 billion to expand its manufacturing capacity.

The scheme nonetheless envisages attracting at least two greenfield semiconductor fabs and two display fabs in the country, 15 semiconductor packaging facilities, and assistance to 100 domestic semiconductor design companies, of which 20 are expected to achieve annual revenue of $200 million in the next five years.

Again those targets seem brave, as India does not currently possess an enormous pool of silicon design talent and recent domestic silicon designs include modest RISC-V processors built on a 180-nanometre process. While India has shown it can quickly grow services industries – and has a renowned technical education sector – there's a lot of work required to become a player.

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Indian prime minister Narendra Modi said the new scheme furthers the nation's "Aatmanirbhar Bharat" self-sufficiency plan and will "position India as global hub for electronics manufacturing with semiconductors as the foundational building block". ®