Tata Group Firms to Set Up India’s First Commercial Semiconductor Fabrication Unit in Gujarat

India has taken a significant step towards technological self-reliance with the signing of a Fiscal Support Agreement (FSA) between the India Semiconductor Mission (ISM), Tata Group firms Tata Electronics Private Limited (TEPL), and Tata Semiconductor Manufacturing Private Limited (TSMPL).

The agreement, signed in the presence of Gujarat Chief Minister Bhupendra Patel, paves the way for the establishment of the country’s first commercial semiconductor fabrication unit in Dholera, Gujarat.

₹91,000 Crore Investment for Semiconductor Manufacturing

The Tata Electronics semiconductor fabrication facility in Dholera will be developed with an investment exceeding ₹91,000 crore. It will have the capacity to produce 50,000 wafers per month (WSPM), catering to the rising demand in sectors such as automotive, computing, communications, and artificial intelligence (AI). 

The Government of India, through ISM, has committed to providing 50% fiscal support on a pari-passu basis for eligible project costs. This initiative is a major step in strengthening India’s semiconductor ecosystem and reducing dependence on foreign chip manufacturers.

The project is also expected to generate more than 20,000 direct and indirect skilled jobs. Tata Electronics will collaborate with Taiwan’s Powerchip Semiconductor Manufacturing Corporation (PSMC) to integrate global expertise into India’s semiconductor industry, enhancing its capabilities and positioning it as a significant player in the global supply chain.

Strengthening India’s Semiconductor Ecosystem

The Fiscal Support Agreement reaffirms the government’s commitment to timely financial support for semiconductor manufacturing in India. Sushil Pal, CEO of the India Semiconductor Mission, highlighted India’s ambition to become a hub for semiconductor production, expressing confidence in Tata Electronics’ ability to strengthen the electronics value chain.

Dr. Randhir Thakur, CEO and MD of Tata Electronics, described the agreement as a historic moment for India’s semiconductor industry. He stated that Tata Electronics is dedicated to building India’s first AI-enabled fabrication facility in Dholera and contributing to the country’s technological progress.

Conclusion

The establishment of India’s first commercial semiconductor fabrication unit in Dholera represents a milestone in the country’s technological and economic growth. This initiative is set to enhance India’s position in the global semiconductor industry while fostering domestic innovation and employment generation.

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