Semiconductor policy set to target investments

By siliconindia   |   Friday, 12 January 2007, 18:30 IST
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New Delhi: The semiconductor policy is all set to give a boost to the investment plans of a number of companies for setting up a base in India. Some of the main projects in the waiting are the $ 3-billion SemIndia project in Hyderabad that proposes 200-mm and 300-mm wafer fabrication facilities based on technology from Advanced Micro Devices (AMD) and an assembly, test, marking and packaging plant. Even Intel, the global microprocessor giant has informed of its plans to setup an Advanced Testing and Manufacturing (ATM) unit in India and is awaiting the Government's semiconductor policy. Talks are floating around about few Taiwanese companies interested in setting up base in India. Senior Government officials said that the policy would attract investments in photovoltaics, LCD panels and semiconductor giving a leg up to consumer electronics industry in the country, which is the fastest growing in the world. With a number of telecom equipment manufacturers announcing plans to set up units in India, the new policy will give a boost to the local production of cheaper mobile handsets. Due to arguments between the Finance and IT ministries on the issue of the fiscal incentive package for investors setting up fab units, the policy has seen delays. The electronic consumption was projected to touch $ 350 billion by 2015 and the country would need to import more than $ 40 billion semiconductor components by then. India will account for 11 percent of the global electronics market by 2015, compared to 1.8 percent in 2005. The new policy will translate the demand into local manufacturing besides creating more employment in the country. However, analysts such as Gartner predict that global fab vendors will look at India more aggressively for its design progress, which expects fab companies to initially set up semiconductor assembly and test (SAT) units.