The Government is likely to consider tomorrow a proposal for setting up of two semiconductor manufacturing facilities in order to check the dependence on import of electronic products, especially chips.
“The Cabinet is likely to consider the proposal of the Telecom Ministry for the setting up of two semiconductor wafer fabrication (Fab) manufacturing facilities in the country,” sources in know of the development said.
India depends highly on imports for meeting its electronic product requirement which includes import of electronic chips as well and these fabs would assist in checking imports, they added.
The investment envisaged for the two units is around Rs 25,000 crore and the level of government support for these units will be decided through negotiation with chip makers.
Electronic chips are key components in various gadgets and devices like mobile phones. They are crucial both from security as well as forex outgo point of view, as India has to import most of the electronic components.
The Government’s own estimates in National Policy of Electronics states that the demand for electronics will reach $400 billion by 2020. It said in the absence of corrective measure, electronics imports will account for $300 billion by that period.
The fabs are expected to bootstrap innovation and R&D, especially in the area of electronics, which will help generate about three crore jobs (direct and indirect) by 2020.