During liberalisation, India’s private sector industrial activities were limited to Maharashtra, Gujarat, Karnataka, Delhi and its adjoining regions in Western Uttar Pradesh and Haryana, terrorism-affected Punjab and the ever-declining West Bengal. Since then, India added at least four new investment destinations Tamil Nadu and Andhra Pradesh (now Telangana) in the South; Odisha in the East and; lately Uttar Pradesh in the North.
On February 29, Assam, in Northeast India, claimed its inclusion in the list, as the Centre approved the production-linked incentive (PLI) to Tata Semiconductor Assembly and Test Pvt Ltd (TSAT) for setting up a Rs 27,000 core semiconductor assembling and testing unit, near Guwahati.
According to the government press release, TSAT is developing indigenous advanced semiconductor packaging technologies including flip chip and ISIP (integrated system in package). The plant will manufacture 48 million chips per day for use in Automotive, electric vehicles, consumer electronics, telecom, mobile phones, etc.
For Assam, A Major Breakthrough
The importance of the investment can be understood from a simple fact: The Union cabinet approved a total of three semiconductor projects on Thursday and two went to the upcoming semiconductor hub of Gujarat, where Micron is already building a plant.
A close scrutiny will prove all high-profile investments in the technology sector are moving to developed destinations in the South and the West. Western UP, also attracted a few. Check the investment map of Apple, General Electric, Samsung etc, and you know that investors are not ready to trade into uncharted territories.
Even Odisha is waiting for the breakthrough beyond metals, ports, energy etc. Assam has now become an exception to this trend.
Add to this the fact that Assam started getting private investment only in the last decade when FMCG players like Hindustan Unilever, Patanjali, Emami etc made a beeline to set up manufacturing units.
Some pharma companies had also set shop in the state. However, in terms of the quantum of investment, none of them are anywhere near the semiconductor project.
The big investments came from the public sector, mostly in refining and electricity generation. This included the ongoing Rs 28,000 crore expansion of Numaligarh Refinery.
To put it in perspective, here is a state that has come up from nowhere to join the ranks of developed destinations like Gujarat, Karnataka and Tamil Nadu. The future will tell if Assam did justice to this golden opportunity.
All Credit To Himanta
But, for the moment all credit to Assam’s dynamic Chief Minister Himanta Biswa Sarma for convincing the Tatas and the Government of India to take the risk.
Tata was always soft to the industrial backwaters of the East. This is partly due to their long association with Jharkhand. They brought the first major private investment in steel and port in Odisha, two decades ago.
They also gifted an automobile project to West Bengal and burnt their fingers. If West Bengal lost its cultural DNA for private investment, Assam never had it.
Assam’s world was always limited to contracts and direct employment in the public sector. The state is also low on skill. And, that’s the greatest risk for the prized semiconductor project.
Tata Group knows it and so does the Narendra Modi government. All of them are banking on a single man, Himanta Biswa Sarma. For, it is Himanta who convinced everyone that Assam can.
Despite the weight of Tata Group, the PLI approval of the project was hanging fire for at least six months, if not more.
The Ministry of Electronics and Information Technology (MEITY) was extremely cautious, if not doubtful, about Assam’s ability, and rightly so. They didn’t want India’s semiconductor plan to go haywire.
Sources in the know say the Gujarat projects were ready for approval at least a month ago. Files were moving back and forth on Assam. And, for all these months and weeks, the Assam Chief Minister was making the rounds in Delhi to get it through. He was reportedly assisted by Ranjit Barthakur, Chairman of FICCI North East.
In the end, it’s a happy moment for Assam.
Pratim Ranjan Bose is an independent columnist, researcher, and consultant. His X handle is @pratimbose. Views are personal, and do not represent the stand of this publication.
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