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Union Cabinet approves modifications in PLI scheme for semiconductors manufacturing


NEW DELHI, SEPT 21, 2021

Keeping in view the growing demand for semiconductors across the globe, the Union Cabinet on Wednesday approved certain modifications in the production-linked incentive (PLI) scheme for its manufacturing.

Under the modified programme, a uniform fiscal support of 50 per cent of project cost shall be provided across all technology nodes for setting up of semiconductor fabs.

Considering the niche technology and nature of compound semiconductors and advanced packaging, the modified programme shall also provide fiscal support of 50 per cent of capital expenditure in equal mode for setting up of compound semiconductors, silicon photonics, sensors, and discrete semiconductors fabs.

The programme has attracted many global semiconductor players for setting up fabs in India, official sources said, adding that 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.

The changes in the scheme will help India become self-reliant in semiconductor manufacturing and enable it to meet the growing demand.

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. The 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.

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