Modifications in “Programme for Development of Semiconductors and Display Manufacturing Ecosystem in India” Approved

· Offer 50% Incentives for Semiconductor Fabs Across the Technology Nodes as well as for Compound Semiconductors, Packaging and other Semiconductor Facilities

The Cabinet, chaired by Prime Minister, Narendra Modi, has approved the following modifications in the Programme for development of semiconductors and display manufacturing ecosystem in India:

i. Fiscal support of 50% of Project Cost on pari-passu basis for all technology nodes under Scheme for Setting up of Semiconductor Fabs in India.

ii. Fiscal support of 50% of Project Cost on pari-passu basis under Scheme for Setting up of Display Fabs.

iii. Fiscal support of 50% of Capital Expenditure on pari-passu basis under Scheme for Setting up of Compound Semiconductors / Silicon Photonics / Sensors Fab and Semiconductor ATMP /OSAT facilities in India. Additionally, target technologies under the Scheme will include Discrete Semiconductor Fabs.

Under modified programme, a uniform fiscal support of 50% of Project Cost shall be provided across all technology nodes for setting up of Semiconductor Fabs. Given the niche technology and nature of compound semiconductors and advanced packaging, the modified programme shall also provide fiscal support of 50% of Capital Expenditure in pari-passu mode for setting up of compound semiconductors / silicon photonics / sensors / Discrete semiconductors fabs and ATMP/OSAT.

The programme has attracted many global semiconductor players for setting up fabs in India. The modified programme, will expedite investments in semiconductor and display manufacturing in India. On the basis of discussion with potential investors, it is expected that work on setting up of the first semiconductor facility will commence soon.

An Advisory Committee comprising global experts from industry and academia was constituted to advise India Semiconductor Mission - the nodal agency for the Programme for development of semiconductors and display manufacturing ecosystem in India. Advisory Committee has unanimously recommended uniform support for all technology nodes of silicon semiconductor fabs / Silicon Photonics / Sensors / Discrete Semiconductor Fabs and ATMP/OSAT, which has been accepted by the Government. The technology nodes of 45nm and above have high demand which is inter-alia driven by Automotive, Power and Telecom applications. Moreover, this segment constitutes around 50% of the total semiconductor market.