Kaynes Semicon, together with Japanese and Malaysian technology partners, assembled the chips in a new factory funded with incentives under Indian Prime Minister Narendra Modi’s $10bn semiconductor push announced in 2021. Modi has been trying to position India as an additional manufacturing hub for global companies that may be looking to expand their production beyond China, with limited success.
One sign of that is India’s first commercial foundry for mature chips that is currently under construction, also in Gujarat. The $11bn project is supported by technology transfer from a Taiwanese chipmaker and has onboarded the United States chip giant Intel as a potential customer.
With companies the world over hungering for chips, India’s entry into that business could boost its role in global supply chains. But experts caution that India still has a long way to go in attracting more foreign investment and catching up in cutting-edge technology. On December 8, Tata Electronics also signed an agreement with Intel to explore the manufacturing and packaging of its products in Tata’s upcoming facilities, including the foundry. The partnership will address the growing domestic demand.
Last year, Tata was approved for a 50 percent subsidy from the Modi government for the foundry, along with additional state-level incentives, and could come online as early as December 2026.
Even if delayed, the project marks a pivotal moment for India, which has seen multiple attempts to build a commercial fab stall in the past.
The foundry will focus on fabricating chips ranging from 28 nanometres (nm) to 110nm, typically referred to as mature chips because they are comparatively easier to produce than smaller 7nm or 3nm chips. Mature chips are used in most consumer and power electronics, while the smaller chips are in high demand for AI data centres and high-performance computing. Globally, the technology for mature chips is more widely available and distributed. Taiwan leads production of these chips, with China fast catching up, though Taiwan’s TSMC dominates production for cutting-edge nodes below 7nm.
“India has long been strong in chip design, but the challenge has been converting that strength into semiconductor manufacturing,” said Stephen Ezell, vice president for global innovation policy at the Washington, DC-based Information Technology and Innovation Foundation (ITIF).
“In the past two to three years, there’s been more progress on that front than in the previous decade – driven by stronger political will at both the central and state levels, and a more coordinated push from the private sector to commit to these investments,” Ezell told Al Jazeera.
Source: Here