Govt likely to approve new semiconductor fab manufacturing applications

The Government of India is likely to approve a fresh set of applications for semiconductor fabrication plants and related component manufacturing units in the coming days, according to sources familiar with the matter. The approval process, which had slowed down during the election period, is expected to regain pace as the administration resumes key policy decisions.

Sources indicated that several new semiconductor projects could also be announced during the upcoming Semicon India event scheduled between September 11 and 13, which will be inaugurated by Prime Minister Narendra Modi. The event is expected to highlight India’s long-term vision of becoming a global hub for semiconductor manufacturing and advanced electronics.

A senior government official stated that the Centre is closely monitoring the progress of ongoing projects, including Micron Technology, which is the first company to begin construction of a semiconductor facility in India. Once fiscal support agreements are finalised with other approved applicants, construction work is expected to commence at various approved sites across the country.

Among the major projects under consideration is the semiconductor fab announced by Tata Electronics in collaboration with Taiwan’s Powerchip Semiconductor Manufacturing Corporation (PSMC), which is being developed at the Dholera Special Investment Region (SIR) in Gujarat. The project involves a significant investment of approximately ₹91,000 crore. In addition, Tata Electronics has also announced a separate chip assembly and packaging unit in Assam with an investment of ₹27,000 crore.

These initiatives fall under the government’s flagship India Semiconductor Mission and the Modified Scheme for Setting up Semiconductor Fabs and Display Fabs in India. Under this policy framework, the Centre offers fiscal support of up to 50 percent of the project cost on a pari-passu basis to eligible applicants, recognising the capital-intensive nature of semiconductor manufacturing.

The government is also working in close coordination with State governments to create high-tech manufacturing clusters. These clusters are being developed with essential infrastructure such as land availability, semiconductor-grade water supply, reliable power, logistics connectivity, and a robust research ecosystem to support at least two greenfield semiconductor fabs and two display fabs in the country.

Apart from Tata Electronics and Micron, other companies have also stepped forward. CG Power and Industrial Solutions, in partnership with Renesas Electronics and Stars Microelectronics (Thailand), has proposed an OSAT (Outsourced Semiconductor Assembly and Testing) facility in Gujarat. Meanwhile, global players such as Tower Semiconductor of Israel have shown interest, although some proposals are currently under review for technological readiness.

The Ministry of Electronics and Information Technology has clarified that the application window remains open for the next decade, underlining that semiconductor manufacturing is a long-term national priority. With renewed approvals and policy support, India’s semiconductor roadmap is expected to gain further momentum in the months ahead.