LONDON – Tower Semiconductor Ltd., an Israel-based foundry chipmaker that trades under the name TowerJazz, has said it has signed a binding memorandum of understanding with an unnamed Indian infrastructure company, to build and operate a 300-mm wafer fab in India.
According to reports, Tower (Migdal Haemek, Israel) will contribute to a consortium by providing know-how rather than cash.
The move would help Tower with migration to 300-mm wafers, to develop 90-nm analog process technology and deep submicron technologies such as 65- 40-nm, the company said.
A three-way consortium comprising Tower, the Indian conglomerate and a company described by Tower as a "worldwide leading technology provider" has presented to the empowered government committee which is overseeing an initiative to support and encourage the development of chip manufacturing in India. A Globes report states that the Tower consortium is bidding against at two other consortia in the government-organized tendering process.
Tower said it is in a strong position to win support from the Indian government because the consortium is strong and because Tower itself has experience of a previous successful government fab project win and execution.
However, Tower added that caution was necessary as it could not predict the outcome of Indian government selection or that it would win the bid.
The Indian initiative was revealed as Tower announced its financial results for 4Q11 and the full year of 2011.
"The recently signed India MOU is a tremendous opportunity for TowerJazz to utilize its manufacturing knowhow and technical expertise to gain a low cost entrance into an emerging market at a 300-mm wafer size level," said Amir Elstein, chairman of the board of directors of Tower, in a statement. "Should this proposal not be accepted, we remain active in pursuing such models where we add benefit to our partners and customers through our expertise and execution and benefit to the shareholders through profitable upside growth."
@HingNan.Cheng..Point b is very valid. India should become strong in Fab supporting services while keeping the Fab as final goal. This should help technically as well as financially ramp up without jerk.
@HingNan.Cheng: valid points! The badly needed ecosystem partners just don't exist as yet in India. There has been some progress in packaging and backend but it has long ways to go.
I would rather hold my applause till there is ground breaking ceremony some where in India for this fab. As I have been saying umpteen times on EE Times forums, India should exploit the MEMS market by establishing several MEMS foundries. They are much less in upfront investment costs and require lesser ancillary / partners.
We have seen these kind of news for years (like from Intel, TI, etc) but none has happened.
Setting up a fab in India it is not a one-off project, but need to have deep pockets (in US$ billions) to fund and to sustain the operations and technology development.
Besides the business support from Indian government, there are 2 areas which must be fulfilled first.
a. The infrastructure - clean and stable utilities such as water and electricity, and efficient logistics.
b. Supporting industries such as the backend IC testing and packaging houses.
I am looking for specific details to assertain this time it is for real.
There are several design houses to supply designs and several consumers in telcom, auto, industrial machinery and such industries. If a fab were to be built, both supply and demand will be met. Now regarding infrastructure, Gujarat has surplus power, it is well connected to industrial locations. The only missing piece in this news is about test and assembly of the proposed fab's output; that, however should not be a show stopper. I think the Dholera special economic zone would be the perfect site to set this up.
In love with bunny suits!
Finland is a very heavy use of cell phones and it has no fabs!
The industry is not asking for yet another country to support. There is enough ground to cover at it is (are you listening Abu Dhabi?). Tower is contributing nothing (how could it be otherwise, they don't run a 300 mm fab) and 100% of the risk falls on the public. Tax arbitrage is all this is. Do people really think that a single fab will make India into an IC powerhouse? I venture to say that India has better, more profitable places to spend its money, like roads, sanitation, education...
It is too early to assess, but I think India will be successful in it. The reality today is that making chips is in fact very simple, except the real high-end ones, moreless only a question of reasonable costs and startup money sources from investors. They can be very successful in some market segments they find, same as new fabs in UAE, Africa, etc. ... easy chips are so cheap now that testing, packaging and also distribution costs more than the production itself.
India falls in the list of very high user density of cellular phones, and as per today's statistics virtually all the cellphones are being imported, the product assembling business is growing a lot but it is also facing the problems due to raw semiconductor components are imported, this is a very great initiative from Government of India, if they can launch is successfully.
It will be good if the manufacturing facility is established somewhere near coastal area due to heavy use of water in IC manufacturing process.
what would be the ideal location for this fab. will it be Chennai, Hyderabad or Bangalore? But anywhere in India this will be great boon for the country to establish themselves in the semiconductor manufacturing.
All initiatives in the past decade have fizzled out. Unless the State pours in capital and provides land, water and electricity this would not take-off. And the State has other priorities than setting up a Fab and rightly so. I am quite skeptical if this would materialize. I think a more feasible option is to be to boost electronics assembly. Its has been predicted that by 2020-2025 India's electronics import will exceed Oil import. That is very scary.
@ the designers and product developers in West. Guys emerging markets (esp. the GIGANTIC yet under-penetrated market in India) are real and an unfolding opportunity I am sure if the electronic eco-system develops in India it would benefit others elsewhere. It is not a zero-sum game.