Renowned for its designing capabilities, the Indian semiconductor industry has eyes now set on manufacturing. India has earned itself a distinct image in the designing of semiconductors. A continued focus on quality coupled with the cost arbitrage has made India a natural destination for Integrated Circuit (IC) design for quite sometime now, and owing to factors such as large pool of skilled professional, it is likely to remain so in future. Lot of high-end designing is happening in the country as even MNCs are setting up their design centers here. Yet, the industry has always struggled to replicate the same in manufacturing semiconductors.
The
first and biggest was, of course, from an Indian association.
SemIndia, a public-private consortium of NRIs and the government,
announced to invest $3 bn for a 1,200-acre facility in June.
Located on the outskirts of Hyderabad, Andhra Pradesh, this
is India's first world-class wafer fabrication plant and assembly
and testing unit. The project, referred to as Fab City Project,
is envisaged to be the center for advanced semiconductor and
electronics manufacturing. Earlier to this, in November last
year, SemIndia had entered into an agreement with AMD, the
world's second largest manufacturer of microprocessors, which
will include transfer of technology for SemIndia's fabs, marketing
and sales, assembly and testing, customer relationship for
SemIndia's chips and various other joint ventures. SemIndia
also has partnerships with Base Oxygen Corporation (BOC),
a global industrial gases company, to provide gases and vacuum
products and services, and Flextronics, another international
semiconductor manufacturer.
Domestic
companies are seen planning huge investments in semiconductor
manufacturing. Xenitis, a Kolkata-based low-cost PC manufacturer,
will be investing Rs. 1,200 cr for a chip manufacturing unit
at Hyderabad's Fab City. Hindustan Semiconductor Manufacturing
Company (HSMC) has plans to set up its own $3.5 bn fab. Nano
Tech Silicon India has already started working on its wafer
fab facility in Hyderabad. The Indian Equipment Manufacturing
Company (IEMC) too plans to invest $600 mn in the capital
city of Andhra Pradesh. Added to this, several MNCs, like
Tessolve from the US, Intellect Inc. from Korea, are also
investing in a big way to set up fabs and ATMP (Assembly-Test-Mark-Pack)
facilities in India.
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