[TusharK]

The government has approved the proposals to set up three semiconductor fabrication plants in India, at an estimated cost of Rs 1.26 lakh crore.



Tata Electronics has joined hands with Taiwan’s Powerchip Semiconductor Manufacturing Corp. (PSMC) to set up a semiconductor fab in Dholera, Gujarat, for Rs 91,000 crore.

According to IT minister Ashwini Vaishnaw, the Gujarat plant will have a capacity of 50,000 wafers per month and employ 26,000 people. The facility will also generate indirect employment for nearly 1 lakh people.

CG Power, Japan’s Renesas Electronics Corp. and Thailand’s Star Microelectronics will set up a semiconductor unit in Sanand, Gujarat, while the third unit will be set up by Tata Semiconductor Assembly and Test Pvt. Ltd. in Morigaon, Assam.

US-based chip maker Micron is also investing Rs 22,516 crore in a chip assembly plant in India.

Source: Moneycontrol

Link to Team-BHP news

[PreludeSH]

Hope it really fructifies. We need more job generating manufacturing and there is a large scope in everyday household items also and in places which witnesses migration of labour.

Our big design services are mostly captive for MNCs and this could help smaller designer firms to have everything done within India. Not sure what gate width will this plant support. Here's their news release.

https://www.powerchip.com/en-global/...ntent/20240229

The TSMC plant in Arizona has not opened due to shortage of skilled manpower. Hope Tatas will address that now.

[ajmat]

Hope it happens although I am not sure if Gujarat is the right place since skills may not be present there

[Nithesh_M]

More dependency on China then. How will Tata ensure PSMC designed chips will be spy proof? Since that's another claim people use to discard brands like MG, BYD, Great Wall, Huawei etc.
And will these China designed India manufactured products also carry local for vocal stickers like their EVs?

[anandhsub]

Originally Posted by Nithesh_M

More dependency on China then. How will Tata ensure PSMC designed chips will be spy proof?

a) PSMC is Taiwanese and not Chinese

b) PSMC only manufactures and does not design chips

[JediKnight]

Originally Posted by ajmat

Hope it happens although I am not sure if Gujarat is the right place since skills may not be present there

There are almost zero skills in India for either wafer manufacturing or packaging, hence everything will start from scratch. We can safely ignore SCL Mohali as it uses outdated technology and is poorly managed. Gujrat already has a head-start with the Micron packaging unit coming there.

Great win for Assam. I am sure the Government there would have given lot of incentives to Tata.

The current government team is very smart in their approach towards semiconductors. They also have a long term strategy for incentivizing Indian fabricated semiconductors for products sold in India. This with the potential size of the Indian market will eventually bring in lot of manufacturing into India. Sometime we do not give enough credit to the Government.

[srh]

While Assam does make sense from the perspective of availability of water, I am not sure about the choice of Gujarat. Semi conductor manufacturing is both water intensive and energy intensive. Apart from Assam, a location on the south-western coast or maybe Bengal would have made more sense compared to Gujarat. But maybe the policy makers know more than what I do!.

[SmartCat]

Originally Posted by JediKnight

The current government team is very smart in their approach towards semiconductors. They also have a long term strategy for incentivizing Indian fabricated semiconductors for products sold in India.

Govt has been or will be investing in talent/skill development in India via tie-ups with foreign universities or corporates. Fully or partly funded by GoI so that companies setting up semiconductor factories in India don't have to put their time & resources into skill development.

2022 article:

Chip sector plan: Training hubs for 6,000 scholars, 2.5 lakh workers
https://indianexpress.com/article/bu...rkers-7830416/

2023 article:

Purdue University To Offer Semiconductor Courses In India, Signs Agreement With India Semiconductor Mission
https://business.outlookindia.com/ne...n--news-307504

2024 article:

India's semiconductor mission focused on talent development, designing entire chip: Minister
https://ddnews.gov.in/business/india...-chip-minister

[IC_Morningstar]

Originally Posted by srh

While Assam does make sense from the perspective of availability of water, I am not sure about the choice of Gujarat. Semi conductor manufacturing is both water intensive and energy intensive. Apart from Assam, a location on the south-western coast or maybe Bengal would have made more sense compared to Gujarat. But maybe the policy makers know more than what I do!.

Bengal will probably the last place to state to initiate a large scale manufacturing plant like this. There is, off-course an abundance of skilled and smart people but the main issue is the political one. After the communists are gone, Bengal has stayed with anti industrial mindset. Who can forget the TATA fiasco.

[safari_lover]

I think, it's quite impressive that Tata Semiconductor Assembly and Test Pvt. Ltd is going on its own, without any partners, for the Assam project. It was mentioned by the Minister that Tatas have developed an indigenous technology for this project, which can be offered to others in the future. If my understanding is correct then it's the equivalent of the upcoming Micron plant in Gujrat.

When these two projects come to fruition, Tata will have a lot of electronics manufacturing capability, right from chips to smartphone assembly, similar to the Samsungs and LGs of the world. Hope to see a truly Indian new age electronic product in the next 5 years from them.

[driven646]

Great initiative by the Government that is critically important for the future of our nation.

Semiconductors are now needed in every aspect of our lives we cannot afford to be purely dependent on foreign countries for them. To give a relevant example, modern cars are now computers too with all the smart features & the steering wheel is more a less a keyboard too.

Everything is getting 'smart' & needs computing power driven by semiconductors.

Japan & the US have already given massive subsidies & are about to open massive new semiconductor fabrication plants. We will soon be the 3rd largest Economy in the World & it's imperative we control this resource independently.

Taiwan through TSMC, South Korea & China control 90% of Chip production & the world recognises that such critical tech cannot be left at risk of a belligerent China that wants to invade Taiwan.

Great move by Tata & our Government.

[PreludeSH]

With so many technical institutes that govt(s) own, they could have already initiated new disciplines to cater to any new investment they are looking at.

With basic engineering already in place, only some specific topics in manufacturing will need foreign collaboration.

[Ashwin Morey]

I am surprised by the lack of investment in Maharashtra! There isn't a single news of any Semi-conductor manufacturing coming up in Maharashtra (at least not to my knowledge). Gujarat is understandable but these days it seems that GJ is the preferred route over MH. Agreed that the current political scenario means that WB will be the last choice however in case of MH, there is no political issue. MH is a fairly industrialized state and there are enough locations that have the ideal conditions for setting up a fab unit.

Hence it is a bit surprising that MH isn't getting any opportunities in this sunrise sector.

[ads11]

I can't seem to open the article but I wanted to know what kind of microchips in particular will both these fabs be focussing on? And what nanometer scale process are they likely to be? That alone could be informative as to what type of chips will be produced.

I'm pleasantly surprised that Assam is one of the locations, albeit it was the private sector leading the way with the location there. Would've been nice to see the GoI also put it's backing behind developing the North-East.

All that being said, I don't think people quite comprehend just how difficult it is to break into the global semiconductor industry, not just from a manpower perspective but for the sheer cost involved. Just one of the cutting edge lithography machines alone costs in the ball park of a quarter billion USD! And that's not to mention the myriad choke points throughout the entire global industry. Take the EUV lithography machines. Only ASML in the Netherlands makes them. And without access to those machines you're really going to struggle to achieve the sort of <4 nm processes the latest TSMC chips are made on.

And as others have alluded to - these are just for creating fabs, the foundries that manufacture chips using the designs from other companies. Designing the microchips themselves is another matter altogether and not an easy one either. Just one foundry is in the scale of 10s of billions USD. To properly get an entirely domestic semiconductor industry going from scratch would require investment in the 100s of billions USD, if not more and it's got to take concerted state level initiative (the private sector alone won't do it). Hence you see the fact that there's rare bipartisan consensus in the US to kickstart domestic foundries again and even EU wide recognition that there's a need to have fabrication capacity given just how reliant many industries are to reliable microchip supply and how vulnerable the global semiconductor industry is because of its concentration in key geopolitical hotbeds.

Highly recommend reading Chris Miller's Chip War - it's an excellent book not just for giving a primer on the global semi conductor industry but also the many fascinating stories behind the characters who helped grow the industry into what it is today.

[electro-monk]

Originally Posted by ads11

And what nanometer scale process are they likely to be? That alone could be informative as to what type of chips will be produced.

It is 28nm from what I read earlier. It being a mature node for Auto sector, and knowing Tata Motors focus on Electric powertrains, can we expect TaMo.EV to start in-house designing its own chips for microcontrollers at least for EV platforms. Nevertheless production-readiness and ground-up design is a long time away.
Another thing to keep in mind is that only the Dholera site will be a fab - the other 2 (including Assam) will be for packaging, testing and qualification. It seems they are pragmatic.

Can some expert comment if we can read between the lines regarding why they split the businesses?

But I agree with the sentiment above in this thread that talent scouting would be a challenge, given the locations.

At the risk of speculating, this could be one reason why Tata stock is shooting since some time.

Interestingly, apart from Micron, none of the semiconductor stalwarts bite the bullet despite the excessive lobbying by the govt. - one half of my mind is full of conspiracy theories for this ; expect to to see more trumpeting on this during run up to the elections