Program for Development of Semiconductors and Display Manufacturing Ecosystem in India

In News 

• The Union Cabinet approved a ?76,000 crore scheme to boost semiconductor and display manufacturing in the country.

About the Programme

• Program for Development of Semiconductors and Display Manufacturing Ecosystem in India aims to provide a globally competitive incentive package to companies in semiconductors and display manufacturing as well as design.
• The program will give an impetus to semiconductor and display manufacturing by facilitating capital support and technological collaborations.
• The move aimed to provide attractive incentive support to companies/consortia engaged in Silicon Semiconductor Fabs, Display Fabs, Compound Semiconductors/Silicon Photonics/Sensors Fabs, Semiconductor Packaging and Semiconductor Design.

Broad Components of Programme

• Semiconductor Fabs and Display Fabs: 
  • The Scheme for Setting up of Semiconductor Fabs and Display Fabs in India shall extend fiscal support of up to 50% of project cost on the pari-passu basis to applicants who are found eligible and have the technology as well as capacity to execute such highly capital intensive and resource incentive projects. 
• Semi-conductor Laboratory (SCL):
  • The Ministry of Electronics and Information Technology will take requisite steps for the modernization and commercialization of the Semi-conductor Laboratory (SCL).
  • MeitY will explore the possibility for the Joint Venture of SCL with a commercial fab partner to modernize the brownfield fab facility.
• Compound Semiconductors / Silicon Photonics / Sensors (including MEMS) Fabs and Semiconductor ATMP / OSAT Units: 
  • The Scheme for Setting up of Compound Semiconductors / Silicon Photonics / Sensors (including MEMS) Fabs and Semiconductor ATMP / OSAT facilities in India shall extend fiscal support of 30% of capital expenditure to approved units. 
    • At least 15 such units of Compound Semiconductors and Semiconductor Packaging are expected to be established with Government support under this scheme.

• Semiconductor Design Companies: 
  • The Design Linked Incentive (DLI) Scheme shall extend product design linked incentive of up to 50% of eligible expenditure and product deployment linked incentive of 6% – 4% on net sales for five years.

• India Semiconductor Mission: 
  • In order to drive the long-term strategies for developing sustainable semiconductors and display ecosystem, a specialized and independent “India Semiconductor Mission (ISM)” will be set up. 
  • It will be led by global experts in the semiconductor and display industry. It will act as the nodal agency for efficient and smooth implementation of the schemes on Semiconductors and Display ecosystem.

• ‘Chips to start-ups’ programme:  
  • The “chips to start-ups” programme would develop 85,000 well-trained engineers.
  •  Semiconductor designers would be given the opportunity to launch start-ups. 

Significance

• In the current geopolitical scenario, trusted sources of semiconductors and displays hold strategic importance and are key to the security of critical information infrastructure. 

• The semiconductor scheme comes at a time when the world is witnessing a severe crunch of semiconductors.
• The supply has been disrupted as a result of the COVID-19 pandemic, which forced many production centres to close intermittently.
• Development of the semiconductor and display ecosystem will have a multiplier effect across different sectors of the economy with deeper integration to the global value chain. 
• The program will promote higher domestic value addition in electronics manufacturing and will contribute significantly to achieving a USD 1 Trillion digital economy and a USD 5 Trillion GDP by 2025.
• The approved program will propel innovation and build domestic capacities to ensure the digital sovereignty of India.
•  It will also create highly skilled employment opportunities to harness the demographic dividend of the country.

Source:TH