Vedanta-Foxconn, Other Chip Firms Expected to Re-Apply for Government Funding Under Revised Scheme

Some applicants including Vedanta Foxconn JV are expected to re-apply for government incentives under the modified semiconductor scheme opening from June 1, according to sources. Under the Modified Semicon India Programme, the government has increased the financial incentive of 50 percent of the project cost for companies, consortia, joint ventures for setting up semiconductor fabs in India of any node (wafer size).

In the old scheme, the incentives varied on the basis of wafer node size.

Similarly, a fiscal incentive of 50 percent of the project cost is available for setting up of display fabs of specified technologies in India, a statement said on Wednesday.

"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 statement said.

Minister of State for Electronics and IT, Rajeev Chandrasekhar said that the first window for more expensive 28 nanometer (nm) fabs was kept open for 45 days only in January 2022 and 3 applications were evaluated by India Semiconductor Mission and its advisory group.

"Strategy now is also encouraging mature nodes of over 40nm - current n new players may apply afresh in various nodes that they hv technology for. It is expected that some of the current applicants will reapply n new fresh investors will also apply," Chandrasekhar tweeted.

Sources said that Vedanta Foxconn JV is also expected to re-apply under the modified scheme.

An email query sent to Vedanta, who is leading the JV, did not elicit any reply.

The application window for “Modified Scheme for setting up of Compound Semiconductors, Silicon Photonics, Sensors Fab, Discrete Semiconductors Fab and Semiconductor ATMP, OSAT facilities in India” is open till December 2024, the statement said.

Leading storage semiconductor company Micron has also applied for setting up an OSAT unit.

"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," the statement said.

Semicon India Programme was approved by the cabinet in December 2021 with an outlay of Rs. 76,000 crore for the development of the semiconductors and display manufacturing ecosystem in India.

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