Soon after the Indian government announced a $10 billion bet to entice foreign investment in the Indian Semiconductor market, Karnataka bagged a big proposal from the International Semiconductor Consortium (ISMC). It has signed a $3 billion MoU with the said consortium to build a fab on a 150-acre land in the city of Mysuru.
Here’s the official announcement of the $3 billion deal by the Karnataka government:
Karnataka will soon be home to India’s first and largest semiconductor fabrication unit! The #Indian #Semiconductor Manufacturing Company ISMC has announced an #investment of Rs. 22,900 crores ($3 billion) - a proud moment for the state.#InvestinKarnataka pic.twitter.com/23p9hQiGOr
— Invest in Karnataka (@investkarnataka) May 1, 2022 ISMC Karnataka semiconductor manufacturing details
An Intel chip used for representational purpose.
ISMC’s full form is the International Semiconductor Consortium. It is a joint venture between Abu Dhabi-based Next Orbit Ventures and Israel's Tower Semiconductor. The latter is set to be bought by Intel for $5.4 billion. So, if all goes well, the American chip giant could also have a footprint on the Indian semiconductor landscape.
Coming back to the current deal, the MoU has been signed between the state government and the consortium for 3 billion USD. As part of this, ISMC Digital will be setting up a semiconductor fab on a 150-acre land in the Kochanahalli industrial area in Mysuru to develop a 65 nm (nanometer) chip-manufacturing process.
The government is bullish on the prospects, not just in terms of the chip-making contribution, but also in the employment that would be created from this effort. It claims the initiative would generate 1,500 direct jobs as well as 10,000 indirect jobs in Karnataka.
While signing the memorandum in Bengaluru (regarded as the Silicon Valley of India), Chief Minister Basavaraj Bommai was present with ISMC director Ajay Jalan, and EV Ramana Reddy, the additional chief secretary, industries, and IT/BT departments.
CM said, “Karnataka understands that it is not only incentives or concessions but also a conducive ecosystem that will attract investors”.
Well, ISMC is not the first to invest, as both Indian-based Vedanta Group and Singapore-based IGSS have shown interest in the Indian Semiconductor Mission project.
Especially, the conglomerate Vedanta has put forward an investment plan worth $20 billion for establishing semiconductor units in Gujarat, Maharashtra, and Telangana.
Just recently speaking at the 3-day ‘SemiconIndia Conference 2022’ event in Bengaluru, the Union electronics and information technology minister Ashwini Vaishnaw said, “First, there are the big silicon fabrication and the display fabrication companies, second is the compound semiconductors and assembly, testing, marking, and packaging category, while the third category is design. The applications for the second and third categories are an ongoing process, while in the first category, the option to take in more applications will be open in the next 5-8 months”.
The Indian semiconductor industry is forecasted to grow from $15 billion in 2020 to $63 billion in 2026.
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