In the interim Budget, the government has increased the allocation for a scheme to support semiconductor and display manufacturing by 130 percent to Rs 6,903 crore, although it is expects to fall behind last year's projection of Rs 3,000 crore in the current financial year.
The revised estimate of expenditure for the 'Modified Programme for Development of Semiconductors and Display Manufacturing Ecosystem in India' in FY24 is Rs 1,503 crore, showed budget documents.
Under the programme, fiscal incentive of 50 percent of the project cost is available to companies/consortia/ joint ventures for setting up of semiconductor fabs in India of any node size (including mature nodes). Similarly, a fiscal incentive of 50 percent of the project cost is available for setting up of display fabs of specified technologies in India.
The application window for the scheme is open till December 2024. Application window of Design Linked Incentive Scheme is also open till December 2024. Till date 26 applications have been received under DLI Scheme and five applications have been granted approval.
The government had launched the Semicon India Programme in December 2021 with an outlay of Rs 76,000 crore for the development of semiconductors and display manufacturing ecosystem in India.
To be sure, the government's spending under the scheme is expected to rise this year as certain payouts may be made for the Rs 22,516 crore semiconductor packaging plant being set up by Micron in Gujarat.
Ground breaking of the unit at Sanand, Gujarat was done in September 2023. Construction of the unit is going on in full swing and is expected to be completed in about 12 months. The memory and storage products manufactured in this unit will cater to domestic consumption and be exported globally.
The unit is expected to create up to 5,000 direct and 15,000 indirect job opportunities over the next 5 years. India Semiconductor Mission, Government of Gujarat and Micron are working collaboratively in close association with academia to train about 10 thousand engineers.
More than 30 gasses, chemicals, equipment, substrate manufacturing and other ancillary industries are in various phases of discussion for setting up facilities in Gujarat.
Agreements for ensuring project milestones are met timely and for disbursement of incentives were signed today among Micron, India Semiconductor Mission and Government of Gujarat.
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