Micron to invest up to $825 mn in chip assembly plant in Gujarat

#WATCH | Washington, DC: Sanjay Mehrotra, President-CEO of Micron Technology, says “I had an excellent meeting with PM Modi. I am very impressed with the vision that he has for India and the advances that India is making. We discussed a wide range of topics and we really look… pic.twitter.com/apAFWhr0dc

— ANI (@ANI) June 21, 2023

“The Prime Minister invited Micron Technology to boost semiconductor manufacturing in India. He noted that India can provide competitive advantages in various parts of the semiconductor supply chain,” a statement by the Prime Minister’s Office said.

The facility will cost $2.75 billion — Micron will invest $825 million, 50 per cent will come from the Central government and 20 per cent from the Gujarat government.

This, however, is not a semiconductor manufacturing facility. Micron’s plant will essentially focus on packaging chips — it will transform wafers into ball grid array integrated circuit packages, memory modules and solid-state drives.

Micron said construction of the new facility in Gujarat is expected to begin in 2023 and the first phase of the project will be operational in late 2024. A second phase of the project is expected to start toward the second half of the decade, it said. The two phases together will create up to 5,000 new direct Micron jobs.

“Micron selected the state of Gujarat due to its manufacturing infrastructure, conducive business environment and a well-established talent pipeline in the SANAND Industrial Park (Gujarat Industrial Development Corporation – GIDC),” the company said in a statement.

“In the last 18 months, after the announcement of the semiconductor vision by PM Narendra Modi and the planned investment of Rs 76,000 cr to catalyse and build India’s semiconductor ecosystem, much progress has been made… This is just a beginning as there is more to come as India rapidly grows as a significant and trusted partner to global electronics and semiconductor value and supply chains,” Rajeev Chandrasekhar, Minister of State for Electronics and IT, said in a statement.

India’s Rs 76,000-crore incentive scheme for the chip ecosystem is yet to attract marquee names to set up core fabrication plants.

To that end, the Union government has received three proposals — from a Vedanta-Foxconn joint venture, international consortium ISMC which included Israel-based Tower Semiconductor, and Singapore-based IGSS Ventures.

However, The Indian Express earlier reported that all three proposals were facing roadblocks.

Vedanta-Foxconn, it is learnt, had initially applied for a 28-nanometre semiconductor manufacturing plant in January 2022, but it has yet to communicate to the government whether it has secured the technology.

Neither Vedanta nor Foxconn have the technology to manufacture such chips and will need to licence it from another company. Vedanta, the metals and mining conglomerate, is struggling to reduce its debt.

ISMC, backed by Abu Dhabi-based Next Orbit and Israel’s Tower Semiconductor, has asked the Centre not to consider its proposal owing to a pending merger between Intel and Tower Semiconductor.

The merger continues to be delayed more than a year after its first announcement.

Singapore-based IGSS Venture’s proposal was not found to be up to the mark by the government’s advisory committee and, as a result, is on the backburner, it is learnt.