The India Semiconductor Mission (ISM) and TATA Group firms, including TATA Electronics and TATA Semiconductor Manufacturing, have signed a fiscal support agreement for setting up India's first commercial semiconductor fabrication unit in Dholera, Gujarat.

The agreement marks a significant step towards realising India's ambitions in indigenous semiconductor manufacturing. TATA Electronics has committed to investing over ₹91,000 crore in the project, which will have a production capacity of 50,000 wafer starts per month (WSPM). The Indian government, through ISM, has pledged to provide 50% fiscal support on a pari-passu basis for eligible project costs, underscoring its commitment to fostering a self-reliant semiconductor industry.

Partnerships

TATA Electronics has formed several strategic partnerships to support its semiconductor fab project in Gujarat, India:

1. Powerchip Semiconductor Manufacturing Corporation (PSMC): TATA Electronics has partnered with PSMC to build India's first AI-enabled semiconductor fab in Dholera, Gujarat. PSMC will provide design and construction support, license a broad portfolio of technologies, and offer engineering support for the project.

2. Himax Technologies: In addition to PSMC, TATA Electronics has also partnered with Himax Technologies to develop display semiconductors and ultralow power AI sensing products. This collaboration aims to enhance chip design and manufacturing capabilities, focusing on display chips for TVs, smartphones, and computer monitors.

3. Tokyo Electron Limited (TEL): TATA Electronics has signed an agreement with TEL to build semiconductor equipment infrastructure, further bolstering its semiconductor manufacturing capabilities.

4. Analog Devices (ADI): TATA Electronics has partnered with ADI to explore semiconductor manufacturing opportunities in India, particularly for electric vehicles and network infrastructure. This collaboration will integrate ADI's semiconductor products across various TATA Group applications.

These partnerships are crucial for establishing a robust semiconductor ecosystem in India, enhancing supply chain resilience, and meeting both domestic and global demand for advanced semiconductor products.

The facility is expected to generate over 20,000 direct and indirect skilled jobs and will cater to critical global semiconductor markets in automotive, computing, communications, and artificial intelligence sectors.

This initiative aligns with India's vision of transforming from a technology consumer to a global manufacturing powerhouse. TATA Electronics has partnered with Taiwan's Powerchip Semiconductor Manufacturing Corporation (PSMC) for the project, which is one of five semiconductor projects approved under the India Semiconductor Mission.

The signing of the fiscal support agreement solidifies the partnership between TATA Electronics, the Ministry of Electronics and Information Technology (MeitY), and ISM to achieve the Prime Minister's vision of manufacturing 'Chips For Viksit Bharat'.

The collaboration is seen as pivotal in strengthening India's electronics value chain and contributing significantly to the country's overarching goals in the semiconductor sector.

Agencies