Govt of India approves Tata Group's Rs 91,000 crore chip foundry, to be set up in Gujarat’s Dholera

The Union Cabinet has given the green light for Tata Group’s proposal to establish a semiconductor foundry with an investment of Rs 91,000 crore, marking a significant milestone for India’s ambitions in the chip manufacturing sector, as per a report by The Economic Times.

With this approval, India is poised to establish its first commercial fab, a goal that has long been pursued by New Delhi to bolster its commercial and strategic interests in line with other major global economies.

According to Ashwini Vaishnaw, the Union Minister for Electronics and Information Technology, Tata Electronics’ initiative to establish the foundry unit will position India as a key player in the global semiconductor market.

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Additionally, the Cabinet has approved two proposals for the establishment of assembly, testing, marking, and packaging (ATMP) units by Tata Semiconductor Assembly and Test (TSAT) and CG Power-Renesas in Assam and Gujarat, respectively. These projects, with a total investment of Rs 1,26,000 crore, will receive subsidies under the India Semiconductor Mission.

Tata Electronics has partnered with Taiwan’s Powerchip Semiconductor Manufacturing Corp (PSMC) for the joint venture, which will be located in Dholera, Gujarat. The construction of this ambitious project is expected to commence within the next 100 days.

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The semiconductor foundry will manufacture high-performance chips in various categories, contributing to the growth of downstream industries such as laptops, servers, mobile equipment, and domestic electronic equipment.

Ajai Chowdhry, co-founder of the HCL Group, described the development as “pathbreaking,” emphasizing its potential to redefine India’s role in the global semiconductor industry.

The Tata-PSMC semiconductor plant aims to manufacture 50,000 wafer starts per month, catering to various sectors including electric vehicles, telecom, defence, and consumer electronics.

Furthermore, the establishment of ATMP units by TSAT and CG Power-Renesas will address the demand for specialized chips in sectors such as automotive, industrial, and power.

Overall, these initiatives are expected to significantly contribute to India’s Semiconductor Mission and create a thriving semiconductor ecosystem, fostering employment opportunities and bolstering the nation’s position in the global semiconductor market.

(With inputs from agencies)