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4 min read
28 Jul 2023, 11:17 PM ISTGulveen Aulakh

Taiwan is very good at the manufacturing of semiconductors. We would like to have at least one Taiwanese company coming to India and manufacturing semiconductors here.


Communications and IT minister Ashwini Vaishnaw (Mint)

New Delhi: India should get two high-quality proposals in semiconductor fab in the next 12 months, said communications and IT minister Ashwini Vaishnaw in an interview.

He said that US packaging and assembly player Micron would get five more companies that are part of its ecosystem players and that more companies were evaluating India as a potential destination. He added that at least one Taiwanese semiconductor company should make chips in India on the back of cooperation with Taiwan. Further, the information technology and telecom ministries are working with the finance ministry to set up specialized units related to the manufacturing of electronics, mobile phones, telecom and semiconductors, such that decision-making is faster. Edited excerpts:

You’ve got nearly $2 billion in investment commitments from AMD, Micron and Applied Materials. What’s the next target?

We are already in discussion with many more players. So the next target is within the next 12 months. We should be approving at least two more good, high-quality proposals in the semiconductor fab. Two, we have approved six design companies, and we would like that to be fully executed.

A fab is expected to be a longer gestation period investment relative to assembly, testing, marking, and packaging (ATMP), which is lower hanging fruit.

There would be many more players who will come because you’re seeing the response that we’re getting here. You’ll see the seriousness with which the companies are evaluating India. You have seen the success of Micron, which has said that in developed countries, advanced pricing agreements can take years. We did that in six months. The land allocation was done within a few weeks. They have started construction activity in such a short time. So, that is giving a lot of confidence to the people that, yes, this is a government very clearly focused on execution, and we should see, in the coming months, a lot more interest in the Indian semiconductor story.

There may still be companies that may be sitting on the ringside, still evaluating India.

Most of the companies were looking for our performance on the ecosystem. They were evaluating whether we were able to deliver on what we had promised on the ecosystem side, and that question has been answered by the progress on Micron.

Already Micron is bringing five more companies with them as ecosystem partners they are bringing already, and as scaling up happens, there will be many more players who will come. We’re now telling the companies that take your evaluation process to the next level to speed it up because we don’t want you to lose the momentum. We don’t want you to lose this opportunity.

Foxconn’s chairman said Taiwan will partner with India. What kind of cooperation would India like from Taiwan?

Multiple things. Taiwan is very good at the manufacturing of semiconductors. We would like to have at least one Taiwanese company coming to India and manufacturing semiconductors here. We are working on that, and we hope to see some results.

What’s your ask from Foxconn, not just in semiconductors?

We’ve had good discussions with Foxconn on multiple fronts. From the government, we are requesting them to evaluate India as a major destination for all their manufacturing activity, all design activities, especially component manufacturing and assembly work, and the entire gamut. India is today poised to be a big manufacturer of everything which has electronics or intelligence in it, which has a complex design process. Companies like Foxconn (admit) yes, this is absolutely the right place to do manufacturing activities, (with the government offering) good policy. So they are scaling up big time. They already have 60,000 people working in India.

What more is being done on the financial reforms or taxation-related reforms for this sector?

We have requested the ministry of finance that for manufacturing of electronics, mobile phones, telecom and semiconductors, there should be specialized units which, over a period of time, develop that expertise, which is required to understand these sectors. They are nicely collaborating with the MEITY and telecom ministry teams to make sure that these sectors, which require very prompt and quick action, and a lot of nuanced understanding, they’re able to take those decisions, understand those sectors and go fast. So that’s progressing very well.

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Updated: 29 Jul 2023, 12:27 AM IST

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