Micron to set up $2.7 bn semiconductor assembly unit in India

01 Jul 2023


Micron Technology Inc, one of the world's largest semiconductor manufacturers, has announced plans to set up semiconductor assembly and testing facility in India.

The announcement came during Prime Minister Narendra Modi's state visit to the US. The announcement came hours after Modi’s meeting with Micron CEO Sanjay Mehrotra in the US, where the latter expressed optimism on “greater opportunities” in India.
Micron has proposed to invest $825 million (around Rs6,760 crore) in the facility, which will involve total investment of $2.7 billion. The government will contribute the remaining in two phases.
The new facility, which will be set up in Gujarat, will be eligible for production-linked incentives worth Rs11,000 crore ($1.34 billion), reports citing government sources said.
‘Sky is not the limit,’ PM Modi said as India­-US ties grew beyond the  Moon mission.
The two sides will step up cooperation in the critical semiconductor manufacturing field, which is currently dominated by Taiwan, South Korea, and China, with a slew of US companies pledging investment in India after New Delhi committed up to $ 2.75 billion for a testing and assembly facility. 
India and US also pledged to work together for global good, as the two countries  firm up an already strong partnership, despite not being formal treaty allies.
“We are excited about the steps India is taking to develop the local semiconductor ecosystem,” Mehrotra said. He said Micron’s new assembly and test location in India will enable the company to expand its global manufacturing base and better serve customers in India and around the world.
Micron’s plant has been approved under the government’s “Modified Assembly, Testing, Marking and Packaging (ATMP) Scheme”. Under the scheme, Micron will receive 50 per cent fiscal support for the total project cost from the Indian government and incentives representing 20 per cent of the total project cost from the state of Gujarat.
“Phased construction of the new assembly and test facility in Gujarat is expected to begin in 2023. Phase 1, which will include 500,000 square feet of planned clean room space, will become operational in late 2024,” Micron said. Micron added that the plant will create up to 5,000 new direct jobs and 15,000 community jobs over the next several years. “Government support will help fund the project and facilitate access to essential semiconductor infrastructure and resources to drive innovation and enhance local talent development,” Micron said.
Micron plans to ramp up capacity over time in line with global demand trends. The company said it expects Phase 2 of the project, which would include the construction of a facility similar in scale to Phase 1, to start towards the second half of the decade.
IT and telecom minister Ashwini Vaishnaw said Micron’s move will transform India’s semiconductor landscape and generate tens of thousands of hightech and construction jobs. Rajeev Chandrasekhar, minister of state for IT and electronics called it a “big milestone”.

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