Micron begins construction of $2.75 billion semiconductor packaging plant in Sanand

The total cost of the plant comprises USD 825 million (around Rs 6,760 crore) from Micron and the rest from the government in two phases.

US chipmaker Micron on September 23 held a groundbreaking ceremony at the Sanand industrial area of Gujarat to flag off the construction of the first phase of a $2.75-billion semiconductor testing and packaging plant.

Micron also signed a contract with Tata Projects for the plant's construction, while  Union Minister of railways and electronics and information technology Ashwini Vaishnaw announced a "world-class" train between the industrial hub of Sanand and Ahmedabad, the western state's financial nerve centre.

"This packaging plant is a testament to Prime Minister Narendra Modi's guarantee to young Indians that India will become a global semiconductor hub," the minister said.

Modi signed the agreement with Micron during his US visit on June 22. "Today we are doing bhoomi pujan within 90 days. This is the speed of a double-engine sarkaar," Vaishnaw added, referring to the BJP governments at the Centre and state working together.

Vaishnaw also hailed Gujarat chief minister Bhupendra Patel for expediting various approvals for the plant.

The total cost of the plant is $825 million (around Rs 6,760 crore) from Micron and the rest from the government in two phases, according to a company statement.

Also Read | Micron plant's groundbreaking ceremony is a big milestone for economy, semiconductor ecosystem: Rajeev Chandrasekhar

Under the scheme, Micron will receive 50 percent fiscal support towards the project cost from the Centre and incentives, representing 20 percent of the cost, Gujarat.

Construction will be carried out in a phased manner. Phase 1 will include 500,000 square feet of planned cleanroom space and will be operational by late 2024.

Minister of state for electronics and information technology Rajeev Chandrasekhar said after the announcement of the semiconductor vision by the PM and the planned investment of Rs 76,000 crore to catalyse and build India's semicon ecosystem, much progress had been made in the past 18 months.

"This is a big milestone in India's roadmap and growth as a Semiconductor Nation," Chandrasekhar said.

Micron said that it picked Gujarat due to its manufacturing infrastructure, conducive business environment and well-established talent pipeline in the SANAND Industrial Park (Gujarat Industrial Development Corporation GIDC).