India expands semiconductor mission with sixth approved project

The Union Cabinet has authorised the establishment of an additional semiconductor facility under the India Semiconductor Mission. HCL and Foxconn will collaborate to set up the plant at the Yamuna Expressway Industrial Development Authority (YEIDA), near Jewar Airport.The government’s Rs 76,000 crore India Semiconductor Mission has approved six projects to date, including this joint venture between HCL and Foxconn to establish a chip manufacturing and packaging facility in Uttar Pradesh.

The facility will produce display driver chips for mobile phones, laptops, cars, PCs, and a wide range of other display-enabled devices. The factory will have a monthly production capacity of 20,000 wafers, while the design output is projected at 36 million units per month.

A total investment of Rs 3,706 crore will be made in the facility , of which approximately Rs 1,500 crore will come from government incentives under the chip manufacturing programme. According to Union IT Minister Ashwini Vaishnaw, the plant is expected to begin chip production in 2027. It will cater to around 40% of domestic demand for these chips in India, with the remaining output to be used by Foxconn at its overseas manufacturing facilities.

India’s semiconductor sector is currently taking shape. Several states have seen the establishment of world-class design facilities, with state governments actively courting design businesses.

So far, five chip manufacturing and assembly plants have been attracted to the country under the government’s initiative. In the first phase of the India Semiconductor Mission, India has secured USD 18 billion in investment. This includes the Tata-PSMC fabrication plant, being constructed at an estimated cost of USD 11 billion, as well as assembly and testing units by US-based Micron Technology, the Tata Group, CG Power (part of the Murugappa Group) in collaboration with Japan’s Renesas, and Kaynes Semicon.

The first made-in-India chip is expected to be launched later this year, with several of these facilities now at an advanced stage of construction. One assembly and packaging plant is under development in Assam, while four more units ,including one fabrication facility and three assembly plants, are planned for Gujarat.