The First Chip facility is expected to open by the end of the year.

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Multinational chipmakers are in talks with several states to develop plants, with the first one slated to open by the end of the year, according to a government official.

Semiconductor companies, including Taiwan Semiconductor Manufacturing Company Ltd (TSMC), are in talks with the states of Andhra Pradesh, Karnataka, Gujarat, Tamil Nadu, Maharashtra, and Uttar Pradesh about “better infrastructure and business incentives in the country.” Big names have expressed interest. “We believe that a number of major suggestions will be adopted soon.” The official spoke on condition of anonymity. “By the end of the year, we should have the first ground-breaking,” the official stated.

The government had previously stated that it has received applications from five businesses to establish electronic chip and display manufacturing units for a total of 1.53 trillion dollars under the Semicon India Program, which gives 76,000 crores in incentives.

 IGSS Ventures and ISMC, a Vedanta-Foxconn joint venture, have proposed chip factories with a combined investment of $13.6 billion and have requested $5.6 billion from the Centre under Semicon India.

India Semiconductor Mission (ISM), an autonomous business division with administrative and financial autonomy, has been established to facilitate the development of a semiconductor ecosystem in the nation. The division’s chief executive officer will be chosen soon, according to the official. The government is also attempting to tie up supply chains and create an ecosystem to attract global semiconductor manufacturers. Chipmakers need reliable energy, high-quality water, proximity to an airport or seaport, and access to chemicals and raw materials, in addition to a competent crew, to develop a factory.

While India is experiencing a power outage amid a scorching summer, potential investors have not mentioned this as a red flag when discussing the country’s investment requirements. “We asked ahead of time, and this hasn’t even come up as a concern.” The power outage has ended. The loads in April are often not this high, putting a lot of strain on thermal facilities, but this has already been rectified,” the spokesman added.

On the supply of specialised equipment, chemicals, gases, and membranes necessary for ultrapure water and other raw materials required for chip manufacture, the official stated that India supplied 30-35 per cent of the bill of material for most ecosystem goods, with the remainder being imported.

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