Centre diverting semiconductor investments using political influence: Karnataka IT Minister Priyank Kharge

Karnataka IT-BT minister Priyank Kharge

Karnataka's IT Minister, Priyank Kharge, has accused the Central government of using political influence to divert semiconductor investments away from the state and move them to Gujarat. Despite the state being home to 70 percent of the country’s chip-design talent and having a well-established electronics manufacturing ecosystem, Kharge believes the central government is using political influence to divert semiconductor investments away from Karnataka.

Kharge expressed frustration over the lack of a level playing field for Karnataka in the semiconductor sector, stating that while the state contributes over 10 percent  to India’s electronics manufacturing output, it is being sidelined in favour of other states.

“We already contribute more than 10% of the national electronics manufacturing output, but more can be done. But what is hurting us the most is the semiconductor play because the central government is not giving us a level playing field,” Kharge told Moneycontrol in an interview on September 24.

“If you are truly interested in making India a manufacturing hub or a chip designing hub, it has to happen from Karnataka. You are just reinventing the wheel elsewhere,” he added.

Given its talent pool and innovation ecosystem, Kharge emphasised that Karnataka is better suited to drive India’s semiconductor ambitions.

“Five semicon manufacturing units, four are in Gujarat, and one is in Assam, but they don't have an ecosystem of skills there. They don't have an ecosystem of research there. They don't have an ecosystem of incubation. They don't have a system of ecosystem of innovations…when 70% of the chip designing talent lies in Karnataka, I don't understand why the government wants to push to another state by using political clout. That is unfair,” he said.

The India Semiconductor Mission (ISM) is examining 20 more projects for approval across all domains, including fabrication, display, compound semiconductors, assembly, and testing.

India has approved five semiconductor projects worth Rs 1.52 lakh crore so far. Micron, Tata-PSMC, CG Power, and Kaynes are establishing chip units in Gujarat. Under the ISM, the government provides a 50 percent subsidy, so roughly Rs 60,000 crore out of the Rs 76,000 crore has already been secured.