India tweaks semiconductor scheme to provide uniform fiscal support
In a bid to attract more players in the semiconductor space, the government has made performance-linked incentive (PLI) scheme more appealing for investors.
Published: 22nd September 2022 08:29 AM | Last Updated: 22nd September 2022 08:29 AM | A+A A-
NEW DELHI: In a bid to attract more players in the semiconductor space, the government has made the performance-linked incentive (PLI) scheme more appealing to investors.
On Wednesday, the government tweaked the existing scheme to provide uniform fiscal support of 50 per cent of the project cost to companies across technology nodes as well as for compound semiconductors, packaging, and other chip facilities.
Earlier, the fiscal support for the scheme ranged from 30 per cent to 50 per cent for different categories.
“Given the niche technology and nature of compound semiconductors and advanced packaging, the modified programme shall also provide fiscal support of 50 per cent of CAPEX in the pari-passu mode for setting up of compound semiconductors, silicon photonics, sensors, discrete semiconductors fabs and ATMP/OSAT,” said a government statement.
Minister of State for IT Rajeev Chandrasekhar addressing the press said the total outlay for the package will remain the same for now, but if needed it will be increased later.
“Prime Minister Narendra Modi has said if there’s a need to increase this Rs 76,000 crore (outlay) by a certain substantial amount, we are ready to do so,” said the minister.
He said the harmonisation of incentives to 50 per cent will make the semiconductor policy competitive and attract investment. Chandrasekhar said India is positioning itself as among the most attractive destination in Asia for electronics and semiconductors, and the government is “confident” that investments of nearly Rs 2 lakh crore will come in the next two years.
Last year, the ministry announced the scheme with an outlay of Rs 76,000 crore to attract semiconductor makers in India. The ministry formed a nodal agency -- India Semiconductor Mission -- for the development of the semiconductors and display manufacturing ecosystem in India.
So far, 4 companies, a joint venture between Vedanta-Foxconn; International semiconductor consortium ISMC, a joint venture between Abu Dhabi-based Next Orbit Ventures and Israel’s Tower Semiconductor; Singapore-based IGSS Ventures and Jeweller Rajesh Exports have applied for the PLI scheme.