LONDON – The Indian government has received approaches from 11 companies with regard to locating wafer fabs in India, according to a Business Standard report, which referenced as its source P.S.Narotra, a senior director in the Department of Information Technology within the Ministry of Communications and Information Technology.
"The Department of Information Technology (DIT) has received proposals from 11 companies to set up wafer fabrication plant in India. There are a couple of domestic firms and the others are foreign firms," the report quotes Narotra telling reporters on the sidelines of the Electronica India exhibition, being held in Bangalore.
The companies were responding to an advert published at the end of June by the recently set up Empowered Committee. The committee, set up in April, is chartered with helping set up at least two wafer fabs at a projected cost of about $5 billion. The committee is in place to identify technologies and investors and to negotiate the level and nature of government support and the mix of grants and subsidies.
The companies were not named but Narotra said that some were seriously pursuing the opportunity and seeking additional information, the report said.
India is keen to set up local manufacturing because it can foresee exploding demand in India for consumer electronics which is set to be met by imports the country can ill-afford. Local chip manufacturing will not only offset those imports but, the government believes, bolster an ecosystem from chips through software to systems.
Well it is a exercise in futility. The Govt will announce a fab with a willing participant, divi up the land near the announced fab, sell it investors for exorbitant money and then watch the fab disappear. This will be the third time... Another major corruption..... Guess the current govt needs money before next election cycle... New gimmick...
Sometime in the middle of the last decade, when Y.S. Reddy was the Chief Minister of A.P State, we heard about the Fab City near Hyderabad, A.P. But that idea never materialized.
An industry expert once gave a very good explanation to me... its not just the capital cost or the subsidized land or tax benefits that are preventing companies from setting up a fab in India... but the shortage of continuous power/water/etc., supply, and the services that are need to sustain a fab.
From a zoomed-out perspective... China is pacing itself to be the next mfg giant with huge investments in energy technologies, the UAE is looking towards Solar/Semiconductor technologies (read as ATIC/GF).. If India were to compete in this fast changing geo-political stage, it has to focus on these technological trends and place itself strategically.
I wonder if the Indian Govt. is thinking realistically when it made this statement in the article "Local chip manufacturing will not only offset those imports but, the government believes, bolster an ecosystem from chips through software to systems. "
If anyone knows better, could you please tell me in which country does such an ecosystem exists? First off, would it be advantageous to have one? With Taiwan (and of course China) in the backyard, a country whose semicon mfg has kept up with the Moore's law and is driving down the costs with its scale, is it practical for India to think that it can create an affordable semiconductor eco-system? May be the Indian Govt is thinking strategically and placing the fab production in such a way that it meets the cost and market demand. But I think it has falsely cried "wolf" too many times already.
@ HVREDDY: Could you pls comment on one other time when this happened?
Well, it doesn't hurt to test the waters, does it? Most know it's a no brainer in not spending billions on a new FAB when fabs worldwide are in post consolidation phase now. If the global leader, TSMC itself was finding it difficult in these lean times to get its order book full then it's better to concentrate efforts on it's domestic electronics industry.
This shows that 11 companies studied well about starting in India. Probably the recent automation in India's Government offices functioning on online which has reduced the bottlenecks at many instances. Soon i feel India will reach its destination for a clean functioning of the Government policies.
This article is a follow-up to an earlier eetimes article from Apr 21.
There it mentions India's govt target of 2020 for a chip industry, which is far too late to rely on current situation. It also mentions drifting interest toward PV, which makes some sense. Bad for US though.
As much as I love India and its people I do not understand why they need a $3-5B fab? They are great with design but why a fab? Brazil tries to pull off a Front End Fab and has problems since years. I also heard that water and power are issues.
My understanding is that the Indian government thinks the country should be making Significant amounts of hardware domestically, meaning chips and equipment. Otherwise it's IT bill in future will grow to exceed it's fuel import bill. The logic is also that without Oil and IT India cannot raise the standard of living for it's citizens.
And if it is a net importer of fuel and IT what will it export to pay for these.
The conclusion seems to be that india needs to start down the road previously taken by Japan, South Korea, Taiwan and China.