Semiconductor PLI: Support for 50% of project cost cleared

The Indian Express | 2 weeks ago | 22-09-2022 | 05:45 am

Semiconductor PLI: Support for 50% of project cost cleared

The Union Cabinet approved on Wednesday changes to the Centre’s Rs 76,000-crore semiconductor production linked incentive (PLI) scheme, allowing for a uniform fiscal support of 50 per cent of project cost for semiconductor fabs across technology nodes and display manufacturing. It also raised the fiscal support for compound semiconductors, packaging and other semiconductor facilities to 50 per cent from 30 per cent earlier.Earlier, incentives for semiconductor fabs were based on the size of the node — nodes from 45 nanometre (nm) to 65 nm were offered an incentive of 30 per cent of the project cost, those between 28 nm and 45 nm were offered a 40 per cent support, and only nodes from 28 nm and below were offered 50 per cent fiscal support. After the fresh changes, all fab plants will receive fiscal support of 50 per cent, irrespective of node size.The higher end nodes are typically used for applications ranging from automotive, telecom, and lower-end laptops and desktops. According to the government, this segment constitutes around 50 per cent of the total semiconductor market, which is among the key reasons why it was increasing support for these legacy nodes.Minister of State for Electronics and IT Rajeev Chandrasekhar said that the changes to the semiconductor policy will increase investors’ interest in the scheme and create additional proposals. He said the government has been in conversation with investors over the last 4-5 months about the scheme, adding that the move has been made to harmonise incentives across semiconductor fab plants, display plants and packaging. “We want the entire integrated semiconductor ecosystem to be present in India. Under the previous terms of the scheme, there was a potential risk that we would have established fabs in the country but the packaging would have happened elsewhere,” he said.On the basis of discussion with potential investors, it is expected that work on setting up of the first semiconductor facility will commence soon, the Cabinet said in a statement.The government had approved the Rs 76,000-crore (roughly equivalent to $10 billion) semiconductor, display manufacturing, and packaging scheme. So far, three applicants — a Vedanta-Foxconn joint venture, international consortium ISMC and Singapore-based IGSS Ventures — have been approved for setting up semiconductor fabs. Vedanta and Elest have submitted applications for setting up display manufacturing. SPEL Semiconductor, HCL, Syrma Technology and Valenkani Electronics have registered under the scheme for semiconductor packaging.The Vedanta-Foxconn joint venture recently signed an agreement with the Gujarat government for setting up a $20-billion semiconductor and display manufacturing plant in the state. However, the joint venture had also come close to signing an agreement with Maharashtra before that, but the eventual agreement with Gujarat became a political lightning rod in Maharashtra with the ruling coalition and the Opposition accusing each other of failing the state. ISMC, backed by Abu Dhabi-based Next Orbit and Israel’s Tower Semiconductor, and Singapore-based IGSS Ventures are setting up in Karnataka and Tamil Nadu, respectively.New Delhi: The Union Cabinet on Wednesday approved the National Logistics Policy, which aims at cutting transportation cost and improve global performance of the sector.Launching the policy last week, Prime Minister Narendra Modi had said that “from 13-14 per cent (of the GDP), we should all aim to bring the logistics cost to single-digit as soon as possible”.The policy aims to bring down logistics cost in India to attain global benchmarks by 2030. It also seeks to improve India’s ranking in the Logistics Performance Index from 44th in 2018 globally; and create data-driven decision support mechanism for an efficient logistics ecosystem, an official statement said.Briefing reporters about the policy, Information and Broadcasting Minister Anurag Thakur said the government targets to place India among the top 25 countries by 2030.The framework comprising Empowered Group of Secretaries (EGoS) under the PM Gati Shakti national master plan will monitor the implementation of the policy.A Services Improvement Group will also be set up for monitoring of parameters of processes, regulatory and digital improvements in logistics sector.The policy implementation will stress development of warehouses, promotion of standards, digitization and automation across the logistics value chain. Among the critical initiatives under the policy are the Unified Logistics Interface Platform (ULIP), the Ease of Logistics Services platform, and e-handbook on warehousing.Fourteen states have already developed their respective logistics policies and for 13 states, it is at the raft stage.Newsletter | Click to get the day’s best explainers in your inboxNew Delhi: The Union Cabinet on Wednesday okayed a Rs 19,500-crore PLI scheme on ‘national programme on high efficiency solar PV (photo voltaic) modules’, seeking to attract Rs 94,000-crore investment in the sector.The solar scheme, under which about 65,000 MW per annum manufacturing capacity of fully- and partially-integrated solar PV modules will be installed, aims to reduce India’s import-dependence in the area of renewable energy. Union Minister Anurag Thakur said about 2 lakh direct jobs will be created in the sector. “The initiative is expected to reduce import substitution of about Rs 1.37 lakh crore,” he said.Solar PV manufacturers will be selected through a transparent selection process.

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