Indian Government Approves $393 Million for New Semiconductor Facility

The Indian government has committed a substantial investment of ₹33 billion ($393 million) to establish a new semiconductor manufacturing plant in Sanand, Gujarat. This funding is part of an incentive program launched in December 2021.

Managed by Kaynes Semicon, the facility is expected to produce 6 million chips daily, catering to various industries such as industrial applications, automotive, electric vehicles, consumer electronics, telecommunications, and mobile phones. It will also increase the demand for essential semiconductor materials like silicon, antimony, and germanium in India.

In addition, the government has previously approved three other semiconductor manufacturing units: two by Tata Electronics in Dholera, Gujarat, and Morigaon, Assam, along with one by CG Power in Sanand. In June 2023, the Union Cabinet also approved the country’s first semiconductor assembly unit in Sanand.

This new plant will be funded through a ₹76 billion scheme aimed at promoting semiconductor and display manufacturing in strategically important areas to enhance economic self-sufficiency, as endorsed by the Union Cabinet on December 15, 2021.

Together, these four manufacturing units are expected to attract nearly ₹1.5 trillion in investment and achieve a combined production capacity of around 70 million chips per day, significantly strengthening India’s chip-making ecosystem.