China invested this amount as both the US and India are undertaking various projects and investing massively in semiconductor manufacturing
The municipal government of Gongzhu in China is said to have invested 200 billion yuan, which is around $29 billion to carry out various developments in the semiconductor industry. As per media reports, the authorities invested this amount as both the US and India are undertaking various projects and investing massively in semiconductor manufacturing. For the past few years, China also did the same to lead the global semiconductor sector.
The South China Morning Post reported that Guangzhou's Industry Investment Fund of Funds (FoF) will chiefly focus on various semiconductor activities, sophisticated manufacturing and growth of renewable energy. In the meantime, the city’s FoF will carefully look out for financing for early-stage high-tech companies. The report further added that the city's funding effort would appear to raise the stakes for China in its tech rivalry with the US. There was a time when the US used to lead the global semiconductor manufacturing and is a home to both fab and fabless, but from the late 90s the East Asian countries such as Taiwan, South Korea, Japan, and China started dominating this industry.
In order to strengthen its manufacturing of semiconductors, the US government has finally unleashed the much-awaited CHIPS and Science act last year, which is worth $53 billion incentives. This will magnetize more global companies to set-up their chip manufacturing bases in the country. India on the other hand also did the same by unleashing a PLI scheme of Rs 76,000 Crore to attract more companies to boost manufacturing in display and semiconductors. Global firms Foxconn and Vedanta had already signed a deal a year back with an investment of Rs 1,54,000 crore in Dholera region of Gujarat. Tata and Singapore’s IGSS are others on the line.
Experts added that in China fiscal support at the state-level has always assisted the country to develop major industries and the China Integrated Circuit Industry Investment Fund or the Big Fund in 2014 played a pivotal role in financing China’s growth in semiconductors and that time the investment was 138 billion yuan.
