India Semiconductor Mission and Tata Sign Fiscal Pact for Gujarat Chip Plant

07 Mar 2025 CW Team

The India Semiconductor Mission (ISM) and Tata Group’s subsidiaries, Tata Electronics and Tata Semiconductor Manufacturing, have finalised a fiscal support agreement for the upcoming semiconductor facility in Gujarat.

Tata Electronics has pledged an investment exceeding Rs 910 billion to establish a semiconductor fabrication unit in Dholera Special Investment Region (SIR). The facility will have a production capacity of 50,000 wafer starts per month (WSPM). The project has received government backing, with the central government, through ISM, providing 50 per cent fiscal support on a pari-passu basis for eligible project costs.

The agreement was signed in the presence of Gujarat’s Chief Minister Bhupendra Patel, marking a significant milestone in India’s semiconductor manufacturing ambitions. The cabinet had previously approved Tata’s investment proposal in February last year.

The semiconductor plant is expected to create over 20,000 skilled jobs, both directly and indirectly. Tata Electronics has collaborated with Taiwan-based Powerchip Semiconductor Manufacturing Corporation (PSMC) for technical expertise and manufacturing support.

Once operational, the facility will cater to crucial global semiconductor markets, including automotive, computing, communications, and artificial intelligence. This initiative positions India as a key player in semiconductor manufacturing, shifting its role from a technology consumer to a global production hub.

News source: Business Standard

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