India’s Semiconductor Mission to open second round of applications, Anil Agarwal-led Vedanta may have to apply afresh


Minister Rajeev Chandrasekhar tweeted, “ISM @Semicon_India is today announcing that it will start accepting and considering new applications for fabs from new and existing applicants.

After a long wait of over 15 months, the government of India is reopening the semiconductor application worth $10 billion again. Rajeev Chandrasekhar, Minister of State, Ministry of Electronics and IT, has confirmed the same, stating that the strategy is now also to encourage mature nodes of 40nm and above. Even existing applications, including Anil Agarwal’s Vedanta-Foxconn joint venture, may also have to apply afresh. The clarification from the minister follows news reports about the India Semiconductor Mission rejecting the Vedanta-Foxconn joint venture.

Minister Rajeev Chandrasekhar tweeted, “ISM @Semicon_India is today announcing that it will start accepting and considering new applications for fabs from new and existing applicants. The first window for more expensive 28nm fabs was kept open for only 45 days in January 2022, and it received three applications that were evaluated by ISM and its Advisory group. The strategy now also encourages mature nodes of >40nm – current and new players may apply afresh in various nodes that they have technology for. It is expected that some of the current applicants will reapply, and new investors will also apply.”

The first round of applications for 28nm fabs was open for a limited period of only 45 days, which did not attract many applications. While the government hoped to receive applications from leading fabs such as Global Foundries, Intel, TSMC, and Samsung, among others, all it received were semiconductor fab applications from three consortiums, including Vedanta’s. The government has also set up an Advisory Board with some very top minds from the industry globally to guide the country in this important mission. And in September 2022, the government modified the incentives in the semiconductor policy to make it more competitive by revising the incentives for all technology node slabs to a flat 50 per cent incentive.

“Opening the window for new applications for Semiconductor Fabs under ISM is a welcome and much-awaited move and will help in getting more applicants for a variety of technology solutions, not limiting to advanced Silicon nodes. The most critical thing at this point for India’s Semiconductor Mission is to actively start working quickly with the interested companies so that we can see the production of wafers and chips in the next 3-5 years,” said Satya Gupta, President, VLSI Society.

Earlier this month, Business Today reported that there was a possibility that none of the applications in the first round would be approved due to the cost perspective. Independent analyst Arun Mamphazy explained the possible reason behind not approving the application in the first round. He stated, “All of the applications, probably, were allowed to tweak their applications after the first round’s deadline of February 15, 2022. This could legally be a problem because the scheme is closed for new applicants, and you are allowing existing applicants to make changes. So, to be on the safe side, ISM might just reopen and say apply fresh.”

On May 10 this year, India’s Electronics & IT Minister Ashwini Vaishnaw was on a three-day visit to the US to interact with chip companies in the country. The outreach by Minister Ashwini Vaishnaw to semiconductor industry leaders in Silicon Valley was seen as an important step in instilling confidence among global leaders in India’s semiconductor mission.

Aiming to become a semiconductor nation, the government of India approved a semiconductor manufacturing scheme with a financial outlay of Rs 76,000 crore in December 2021, which will be increased in the future as and when required.


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