Government invites fresh applications for setting up Semiconductor, Display Fabs under Modified Scheme from June 1

The central government has decided to invite new applications for setting up of Semiconductor Fabs and Display Fabs in India from June 01, 2023 under the Modified Semicon India Programme. The applications will be received by India Semiconductor Mission, the designated nodal agency entrusted with the responsibility of implementing the Modified Semicon India Programme for development of semiconductors and display manufacturing ecosystem in India, the Ministry of Electronics and IT said in a statement. The India Semiconductor Mission (ISM) is tasked with spearheading the country’s $10 billion semiconductor manufacturing drive.

The applications are expected to be received from some new as well as existing investors. Earlier, Rajeev Chandrasekhar, Minister of State for Skill Development and Entrepreneurship of India, had tweeted that the first window for more expensive 28nm fabs was kept open for 45 days only in January 2022 and received 3 applications that were evaluated by ISM in its Advisory group and the strategy now is to also encourage mature nodes of >40nm wherein current and new players are expected to apply in various nodes that they have technology for. 

Under the modified programme, a fiscal incentive of 50 per cent of the project cost is available to companies/ consortia/ joint ventures for setting up of Semiconductor Fabs in India of any node (including mature nodes), the ministry said. Likewise, a fiscal incentive of 50 per cent of the project cost is available for setting up of Display Fabs of specified technologies as well.

The application window of “Modified Scheme for setting up of Compound Semiconductors / Silicon Photonics/Sensors Fab/Discrete Semiconductors Fab and Semiconductor ATMP/OSAT facilities in India” will be open till December 2024. The application window of Design Linked Incentive Scheme is also open till December 2024. “Till date, 26 applications have been received under DLI Scheme and five applications have been granted approval,” it said.

The government had launched the Semicon India Programme in December 2021 with an outlay of Rs 76,000 crore. The scheme was later modified in September 2022 to make it more competitive. The modified scheme includes fiscal support of 50 per cent of project cost on pari-passu basis for all technology nodes under scheme for setting up of Semiconductor Fabs, Display Fabs and Compound Semiconductors/ Silicon Photonics/ Sensors Fab and Semiconductor ATMP/ OSAT facilities in India. Additionally, target technologies under the scheme will include Discrete Semiconductor Fabs.