Last day to submit EoI for semiconductor fabrication units pushed back

Firms need more time to prepare their DPRs: Govt

The government has extended the deadline for submission for expression of interest (EoI) from companies for setting up a semiconductor fabrication unit for a second time, pushing it back by a month from March 31.
 
As part of an ambitious policy, the Ministry of Electronics and Information Technology (MEITY) had floated an EoI in December seeking proposals from global and Indian companies, including consortiums. But the EoI has gone through two postponements on the final date of submission — the first was at the end of January and now it has been postponed again.
 
While the government has said the reason for the extension is primarily because global fabrication companies are asking for more time to prepare their detailed project reports, many global players in the business say that with the large new capacities of wafer plants being built in Taiwan, the US and now in China, the expectation is a large capacity in the global market.

 

They also say that India does not have the infrastructure or domestic demand to attract multi-billion dollar investments in a fabrication plant. But the government has other ideas and intends to continue with its aggressive push in semiconductor fabrication and other high tech areas. On March 19, it set up an empowered committee for manufacturing in high technology areas under the chairmanship of the Minister of Commerce and Industry and including members from the corporate sector. 
 
The committee will consider investments and proposals and take action to facilitate them. 
 
The MEITY has also said that it is earmarking $5 billion as fiscal support for semiconductor and display manufacturing, domestic product manufacturing companies, and the Internet of Thing devices and wearables. This is a substantial amount considering that the government’s total fiscal support to turn India into a global hub for electronics manufacturing is $25 billion.

 
The MEITY has also targeted global companies which could potentially be attracted. These include TSMC, UMC and Via Techn­ologies from Taiwan, US giants Intel, NXP and Texas Instruments, Samsung in South Korea, Fuji Electric, and Panasonic in Japan and European players like ST Microelectronics and Infineon.
 
Business Standard contacted many of these companies but they declined to comment about their interest or said it was too early for them to make a call.
 
Global semiconductor sales are dominated by the US which has a 47 per cent share of the market, followed by South Korea with 19 per cent and Japan with 10 per cent in Europe. 

 
The government is looking at a fabrication plant on three levels. It is seeking preliminary interest from integrated design manufacturers, foundries or a consortium with an Indian company to set up a new fabrication plant or expand an existing one.
 
This plant will use complementary metal oxide semiconductor technology — an adva­nced method of making integrated circuits — to manufacture processors, memory integrated circuits with a capacity of 30,000 wafer starts per month and a wafer size of 300 mm.
 
At the second level, the MEITY seeks players with the same qualifications to set up a semiconductor unit of emerging technologies with a wafer size of 200 mm.

 
At the third level, it is interested in Indian companies who are part of a consortium which wants to acquire a semiconductor fabrication unit in India.
 
The government has asked potential investors what kind of financial support they require from it, whether it is grant in aid, viability gap funding in the form of equity or long term interest free loans, tax incentives, or infrastructure support. It has also asked them to specify the support they will need from the states.   
 
Interested companies have also been asked to give details of their investment and technology specifications.  Based on these details, the government will devise a scheme for them to set up a manufacturing plant.