Why Global Semiconductor Companies Are Now Preferring India to Set-up their Production Unit

Published  February 9, 2023   0
S Staff
India- Semiconductor

IESA and Counterpoint Research in its survey report mentioned that India's semiconductor component business would reach $300 billion in total revenues by 2026

Media reports have now stated that several international semiconductor companies are now planning to set-up their bases in India and boost the industry. For instance, Foxconn and Vedanta announced a JV back in September last year to begin their fabrication plant in Dholera region in Gujarat. Tata Group on the other hand, has also been reported to set-up their semiconductor manufacturing unit in India, as per Tata Sons Chairperson Natarajan Chandrasekaran. 

Apart from the Vedanta-Foxconn consortium, the government has received five other bids to commence semiconductor fabrication units such as Next Orbit Ventures that has associated with Israel’s Tower Semiconductor and also Singapore based IGSS Ventures. According to the experts, the Vedanta-Foxconn consortium is likely to invest a sum of $19.5 billion dollars, which would help various global companies set-up their bases in the country. This move will ultimately put Make-in-India initiative on an international competitive scale. As per media reports, the company with world’s biggest chip foundry TSMC is also aiming to begin its chip-fabrication process in India and wants assistance from the government to check the required viability. 

Read more: https://circuitdigest.com/news/why-foxconn-vedanta-jv-looking-to-partne…

TSMC already has one office in Bengaluru from where it offers various assistance to its customers in Asia, North America, and Europe and also helps Indian fabless companies with growth and design. In fact, there are various speculations of a possible partnership between Tata Group and TSMC. Other than this, Taipei Times recently reported that Powerchip Semiconductor Manufacturing Corporation, which is also a Taiwanese chip-making firm, wants to begin its new chip operations in India. But, after six months of speculation the plans have been finally shattered. 

Renesas Electronics, Japan’s biggest chip-making firm has already announced its partnership with Tata Motors to make, design, and develop semiconductor solutions. Renesas has further announced they are now looking forward to run their fabs in India and manufacture and export silicon chips for their international EV customers. East Asian countries such as South Korea, Vietnam, China, and Taiwan have been leading the semiconductor manufacturing landscape for decades. But, after the coronavirus pandemic, the situation has changed. Anti-China sentiments and China Plus One Strategy has gained huge momentum among the US, EU, and India. These countries now want to decrease their reliance on international supply chains in certain critical technologies.

Now, apart from the Asian countries, companies such as Intel and AMD are also aiming to begin their semiconductor operations in India via their partners. For instance, Micron Technology of late, announced its plan to invest more than US$41 million in Hyderabad, Telangana for its new production plant. Last but not the least, India Electronics & Semiconductor Association (IESA) and Counterpoint Research in its survey report mentioned that India's semiconductor component business would reach $300 billion in total revenues by 2026.