PM Modi Inaugurates India's First Semiconductor Fab in 30 Years

During a live virtual conference, Indian Prime Minister Shri Narendra Modi officially inaugurated three semiconductor facilities collectively valued at INR 1.25 trillion (US$ 15 billion), signaling the commencement of India's ambitious endeavor to establish its semiconductor ecosystem. Dubbed 'India's Techade: Chips for Viksit Bharat', the online event featured Prime Minister Modi addressing the nation's youth and highlighted a pivotal moment in semiconductor collaboration between Taiwan and India.

The flagship project among the trio that launched was the semiconductor manufacturing plant located in Dholera, Gujarat. This facility, a joint venture between Taiwan's Powerchip Semiconductor Manufacturing Corporation (PSMC) and Tata Electronics, boasts a 300mm (12-inch) wafer fabrication unit. It is geared to manufacture chips utilizing 28nm processing technology, marking India's initial foray into commercial semiconductor fabrication in three decades.

Anticipated to achieve a monthly production capacity of 50,000 wafers, the facility is projected to commence production by the conclusion of 2026, generating over 20,000 skilled employment opportunities. The Dholera plant commands an investment total of INR 910 billion, with 70% of the expenditure borne by the Indian government, while the remaining funding is provided by the Tata Group. It is worth noting that PSMC will not invest or operate the facility directly and will be responsible for transferring its technology to the Indian operators and employee training. Led by the company's newly established "manufacturing IP transfer department," PSMC will be earning royalties for its technology transfers.

PSMC Chairman Frank Huang had previously emphasized that this partnership aligns with a directive from Taiwan President Tsai Ing-wen to aid India in constructing a semiconductor plant. During the video conference, senior government officials from Taiwan and industry leaders from the offices of the India-Taipei Association participated, with their virtual presence acknowledged by Prime Minister Narendra Modi.

"I feel that this marks a new chapter in the relationship between Taiwan and India", says Chung-kwang Tien, Taiwan's Deputy Minister of Foreign Affairs. The deputy minister believes this semiconductor collaboration elevates the Taiwan and India relationship to the next level, thanking the efforts of PSMC and the Indian government.

Deputy Chief Negotiator and Director-General of the Bureau of Foreign Trade Jen-Ni Yang shares similar sentiments, characterizing the significant progress of the project as establishing the fundamental groundwork for future collaborations between Taiwan and India. Yang expresses a desire to explore additional trade agreement opportunities for Taiwanese enterprises in the times ahead.

Mr. Manharsinh Laxmanbhai Yadav, the Director General of the India Taipei Association, underscores that this collaborative effort strengthens the burgeoning partnership between India and Taiwan, underscoring a mutual dedication to technological progress and innovation from both parties.

The remaining two projects that commenced include Outsourced Semiconductor Assembly and Test (OSAT) facilities: one operated by Tata Group in Morigaon, Assam, and the other by CG Power and Industrial Solutions Limited in Sanand, Gujarat. The former garnered a total investment of INR 270 billion, generating 30,000 employment opportunities, while the latter incurred costs of INR 75 billion. Regarding the inauguration of these two facilities, Natarajan Chandrasekaran, Chairman of Tata Sons Pvt. Ltd., anticipates that these manufacturing hubs will leave a lasting impact on India, positioning it as the preferred destination for semiconductor production globally.