SemIndia plans $3 billion chips facility in south

SemIndia, a consortium of non-resident Indians, is scouting for a location in south India to set up a semiconductor manufacturing facility with an investment of $3 billion.

"Semiconductor manufacturing is one of the most sophisticated human endeavour and there is no modern unit in the country at present," said Vinod K Agarwal, founder president and chief executive officer. He said he wanted to make India a prime destination for semiconductor manufacturing.

Agarwal hinted the government should provide logistical support to set up the facility. "Logistics is the biggest issue for setting up a capital-intensive semiconductor plant, in which government needs to become a partner," he said.

On the present state of affairs in his home state Madhya Pradesh, he said the state has not seen much industrial development has taken place in the industrial sector in the state. It is difficult to invest in MP owing to lack of international airport.

Agarwal, who was recently in news for an agreement between his company and chip major Advanced Micro Devices, gave the examples of Andhra Pradesh, Karnataka, Tamil Nadu and said the mindset of both bureaucrats and politicians was equally important, when it comes to attracting mega investments.

"The state government has failed to create infrastructure for industrialisation, despite making several commitments," he said.

SemIndia foresees a huge demand for microchips in the country with the country's consumption of electronic goods based on chips touching Rs 45,000 crore in 2004-05, which is expected to grow to Rs 450,000 crore in 2005-06.