| A consortium of US-based Indians was in talks with the government to set up a $3-4 billion semiconductor fabrication facility in India, Communications and Information Technology Minister Dayanidhi Maran said in Chennai today. |
| The consortium uses the banner "Indian Equipment Manufacturing Company (IEMC)". Maran said Prime Minister Manmohan Singh had given an in-principle approval to the government taking an equity stake in the project if the talks succeeded. |
| The government needed to give financial support to such a project to bring long-term benefits to the industry, Maran said. |
| In its initial correspondence with the government, IEMC had mentioned that companies like Texas Instruments and Motorola were willing to support the project, officials in New Delhi said. The government has not verified the claims with these companies. |
| The officials told Business Standard that the finance ministry and the IT department had also sent a letter to the consortium, promising help to the project, which would require uninterrupted high-quality power supply and a large tract of land. They also said clearance on environment matters was crucial to the project. |
| In addition, the project would require tax benefits and access to funds from international markets, which might not be a problem if the proposed facility was declared a special economic zone, officials added. |
| Fabrication facilities for semiconductors are concentrated in the Asia-Pacific region. Some design work for semiconductors (the first stage) is carried out in India by companies such as Texas Instruments. |
| The assembly and testing of semiconductors""the final stages of manufacture"" are also carried out in the country, though in the key stage of fabrication, countries such as Taiwan are dominant. |
| Recently, a company called Nano Tech Silicon India was floated in Hyderabad to fabricate semiconductors. Maran, however, said Nano Tech's project would deal with semiconductors of lesser sophistication (250 nanometers). Talks with IEMC are on for a sophisticated fabrication facility (50 nanometers). American company Applied Materials will supply equipment to IEMC if its talks with the government succeed. |
| Maran felt that the stage had come when there was a sound economic reason to start semiconductor fabrication in India. The advent of big projects in India in electronics manufacturing had provided a platform for the entry of related industries, said Maran. Chipping in |
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