India Chips in With Semiconductor Plant Set-Up Costs Aid


India has promised a helping hand to its semiconductor and display sector by offering project cost aid and moving to remove investment limits.

New Delhi made the announcement on Wednesday, pledging to cover half of chip packaging plant set-up costs, as it bids to lift its struggling manufacturing industries.

The move comes as Prime Minister Narendra Modi’s government seeks to attract more big-ticket investments under a $10 billion incentive plan for chip and display production, aiming to make India a key player in the global supply chain.

“On the basis of discussion with potential investors, it is expected that work on setting up the first semiconductor facility will commence soon,” a government statement said.


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The government had previously agreed to cover between 30% and 50% of the cost of setting up new display and chip plants. It said on Wednesday that it will also cover 50% of the capital expenditure required to set up semiconductor packaging facilities.

Last week oil-to-metals conglomerate Vedanta and Taiwan’s Foxconn signed a pact with India’s Gujarat to invest $19.5 billion in the western state to set up semiconductor and display production plants. 

Vedanta is the third company to announce a chip plant location in India after international consortium ISMC and Singapore-based IGSS Ventures, which are setting up in the southern states Karnataka and Tamil Nadu respectively.


  • Reuters with additional editing by Sean O’Meara


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Sean O'Meara

Sean O'Meara is an Editor at Asia Financial. He has been a newspaper man for more than 30 years, working at local, regional and national titles in the UK as a writer, sub-editor, page designer and print editor. A football, cricket and rugby fan, he has a particular interest in sports finance.

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