AP leases 100 acres in Fab City to SemIndia''s project

Mumbai: The Andhra Pradesh government has issued orders leasing out 100 acres of land for 66 years, at a nominal rate of Re1 a year, at the 1,200-acre Fab City for its proposed semiconductor-manufacturing project of SemIndia

SemIndia, on its part, will have to set up $75 million assembling, testing, marking and packing (ATMP) facility within 18 months, $750-million chip manufacturing unit within 3 years and $2.25 billion advanced semiconductor plant within 5-7 years from the date of allotment of land.

SemIndia will join hands with Andhra Pradesh Industrial Infrastructure Corporation (APIIC) in the Fab City SPV, which will develop state-of-the-art infrastructure to house fabs and fab-related eco system under the public-private partnership route.

The government has agreed to meet power requirements of the project at a subsidised rate of Rs1.85 a unit for a period of 15 years. The government will also provide 5 million gallons a day (MGD) of water in phases, based on the requirement, at Rs15 a kilolitre for 15 years.

Besides, the project will be entitled to full reimbursement of VAT and CST, exemption from other duties and benefits accruing to SEZ units as also policy incentives announced by the central government.

The state government will extend a training grant of Rs10,000 per head for up to 15,000 employees with the proviso that the training grant for a person shall not exceed 50 per cent of the total training cost. The government will also facilitate the establishment of a world-class engineering and technology university by the company.

The much-awaited government order (GO) issued late on 28 April, has asked SemIndia to play the role of an anchor industry on the 100 acres. The government will allot the remaining 1,100 acres in Fab City to other developers.