I am apalled at the quality of the posts in this discussion. EETimes posts normally tend be well informed discussions. But there seems to be a complete reluctance to discuss the merits of this issue and the underlying factors related to this topic. A few facts may help change this discussion from meanginless diatribes to discussing the pros and cons of the issue
1. India is looking at an import of electronics of somewhere bewteen 200-300 Billion USD in the 2022-2025 timeframe. This is a major balance of payment issue and represents a far higher strategic threat than energy. Naturally the Indian FED, RBI and the Finance ministry is worried. and it is blindingly obvious that such a situation cannot continue to prevail for very long. A lot of discussion has happened among stakeholders in Govt. departments, research labs and tech companies. So what you are seeing unfloding (albeit at a glacial pace!) is the result of extremely detailed analysis and discussions. A lot of those discussions were blunt, no-hold holds barred voicing of opinion.
2. The fabs are not govt owned and are private fabs with the tech coming from IBM and ST respectively. All past proposals have also been private industry proposals. The only demand from the fab proposers has been govt. assistance. This was refused earlier but seeing that pretty much any new fab in the world needs govt assistance, this was agreed to in the current case. It is a combo of tax incentives, direct investment, land accquisition help, utility guarantees and viability gap loans. Immediate burn is not clear but probably 3-4 B. This is not chump change but not huge sum, cost of a new carrier for the navy. So well worth the investment, considering you can recover this within 5 years.
3. The govt. is not going to gain major brownie points on this since it is not a hot button issue for the electorate. Economic mitigation exercises that will take effect a decade from now is typically not high on a voter's list of issues. Hence this rush is not driven by electoral politics. Maybe voters who are VLSI designers matter, but something tells me that is not a large vote bank !
4. A lot of ground work is also being done to bolster the training for feeding the electronics eco-system. This includes job profiling, standard curriculum and new trade schools. Most of this is aimed at PCB manufacturing, Electronics assembly, field service personnel and entry level engineers. Two reasons for this. One this is where the real talent shortage will arise and bolstering maufacturing talent is what will keep unemployment down in the long run. The US could learn a few things from this exercise. Making your workforce empoyable in manufacturing with a decent living wage is good ecenomic policy. This is a massive effort that has not been publicised. Once the fab story is clear, fab training will also be added to the training exercise. There are few old fabs in the country where basic training happens even now.
5. An extensive open source IP program is also underway that will feed the fab. This is not to say that this will take care of all fab capacity but it will solve the problems for strategic part supply and critical infrstructure componenents that need to be locally sourced. This is a huge market. Considering that this implies an entire range of processors, interconnect switches, storage controllers and SoC blocks, you are talking massive amounts of IP. All this has been underway for the past few years in anticipation of the fabs. Local IP vendors are starting to get seeded with this to prepare them for a product transition. Would you rather not go to a fab that offers free IP ?
6. The actual need, if you look at where these components get used is in the controller space. So the immediate need is actually fabs in the 65-130 nm space. The new fabs start at 40nm, so it is more than sufficient to meet the real demand.
If you dwell a bit on these points, perhaps a more nuanced discussion can take place. India will hit about 1.5 billion people in 2025 or so. That is about 20% of the world's population. Do you seriously think 20% of humanity will not make an attempt to control its own destiny in such a key area ? Any govt. would be utterly remiss if it does not have an agressive policy in this area. The same things was said about the auto industry in the 80s. Now we are No 1 in the two wheeler segement (the Chinese are unable to enter the market and in fact sell clones ! Check out Bajaj Pular clones) and the leader in low cost car design and manufacturing. I am not claiming a great Indian capability. All it took was good policies, lots of hard work and local consumption to catch up. fabs are the same, nothing particularly challenging in building one if you have the money and are in it for the long haul. Quarterly profits are irrelevant when building strategic capability.
I think TATA, HCL and WIPRO would be better Indian Partners for this venture for the following reasons:
All of them have exposure to electronics goods manufacturing.
They are financially sound and doing B$ business.
They also have BUs that can offer value added services in the area of EDA.
They offices are scattered globally offering easy international presense.
IBM tie-up is good only upto construction of plant and to some extent erection of auxiliary plant equipments. They can be involved in civil maintenance work. They can not certainly contribute in the knowledge field. This tie-up means that IBM is a solo owner and Jaiprakash Ind meets the bidding requirements.
I will believe this when I hear of ground being broken, serious construction taking place, and people stepping forward to run the fabs with commitments from customers in hand to buy what the fab produces.
As others have mentioned, this sounds like pre-election political posturing.
They have a Trade / Lobby group over there calling itself grandly the Indian Semiconductor Association and has been pushing for CMOS logic Fabs now for 7 or 8 years. Doubtful if a single one of the members have ever seen the insides of a Fab or have any inkling of Device Physics. At best some are just surplus Programmers, be it Embedded or higher level or EDA vendors focused on Logic / Processors. But most of them are just salesmen working for various overseas chip companies.
Their argument for pushing for a multi-billion dollar CMOS Foundry ( actually 2 ) has been that it will give Indian chip design companies an opportunity to have their designs fabbed in India itself and thus the nation would keep a larger part of the revenue. But are there really any Fabless chip companies in India that can create business for these multi-billion $ CMOS Foundries ?
All that India now has are a large no. of international semiconductor companies who get just small bits of their chip designs done there. Unlike Taiwan ( MediaTek ) or even China ( Spreadturm ) India has NO independent companies who can design a whole SoC. So where are they going to get proven designs with no IP issues to fill the domestic Fabs ? Instead of first promoting a few domestic chip design companies in India that would probably cost no more than 100s of million $ ( incl. making sure that they are on the ball by getting the designs turned into Si at TSMC etc. and then tested ) the Govt. over there seem to be bent on blowing several billion $ to subsidize old node ( 65 nm and older ) Fabs !
Have they not researched first SMIC and other Chinese Foundries that were started almost 15 years ago w/ no in-house R&D but with plans to jump to 90 nm DRAM based on imported technologies ? Even though the Chinese Govt. has enough muscle to favor local mfr. and China now has several Fabless Co.s to generate business, these Foundries have struggled and had to be bailed out repeatedly with billions in new loans.
The dilemma of new Fabs / Foundries that start with no technical expertise of their own is thus : even if they get Govt. support ( in this case $2 to 3 billion ) and start by licensing technology at an old node ( the talk is 65 nm or older ) it still takes them 4 to 5 years to absorb that old process and they never manage to make enough profit to qualify for a loan ( another $3 to 4 billion ) to upgrade to the next / more profitable node ( while the leading edge / most profitable node has perhaps already moved 3 to 4 generations ahead ). Without a huge bail-out ( e,g. by the Govt. ) to leapfrog to the leading edge, it becomes a slow but inevitable slog to shut-down.
One would have thought that at least in India they would have known all about WHITE ELEPHANTS !!
It has been a while since this has been in the works, and the details remain few and far between. Still, the creation of fabs for semiconductors in this part of the world represent a seminal moment in their emergence as true competitors to the United States and the few other countries that produce semiconductors to this point.
What fabs? After reading the article several times I still have no idea of what fabs this is all about. Is it a 300mm? 200mm? Logic? Memory? Packaging? What is the budget? $50billion? $20billion? $100million? That makes a huge difference in attracting people's attention, or not.