The government of India on Thursday approved "in principle" a plan to construct and equip two wafer fabrication facilities in the country, in a move designed to reduce India's reliance on imported semiconductors. Two consortia will go ahead with the twin fab projects. One is led by STMicroelectronics, an integrated device manufacturer, and the other is spearheaded by Tower Semiconductor, a silicon foundry. These companies will add their names to list of VLSI companies in India and boost the manufacturing capability.
"The Cabinet has given in-principle approval for setting up of semiconductor wafer fabrication manufacturing facilities," Information and Broadcasting Minister Manish Tewari told reporters after a meeting of the Union Cabinet, chaired by Prime Minister Manmohan Singh.
After considering proposals from two consortia, the government took the decision. The government received proposals from two consortiums to set up chip fabrication units in the country. One was led by Israel's Tower Jazz and the other was led by Geneva–based chipmaker STMicroelectronics.
Israel-based foundry chipmaker Tower Semiconductor Ltd, which operates under the brand name TowerJazz, partnered with IBM and Indian infrastructure conglomerate Jaypee Associates to build and operate a 300mm chip facility in India. On the other hand, STMicroelectronics partnered with Hindustan Semiconductor Manufacturing Corp. (HSMC).
Welcoming the government's decision, India Electronics & Semiconductor Association (IESA) President PVG Menon said, "The IESA deems the fab a highly strategic game changer for India. Some of the world's leading economies including the USA, France, Germany, Ireland, Japan, Singapore, Taiwan and China besides a number of developing economies like Malaysia and Israel have their own fabs. These fabs continue to contribute significantly to the growth and development of the economy of their respective countries and we hope that this would be the case in India as well."