Intel-owned Tower Semiconductor's chip-making plan in India back on table

Israeli chipmaker Tower Semiconductor, which was recently acquired by Intel for $5.4 billion, is actively in discussions with the Indian government to set up a manufacturing facility in India, according to a source close to the developments.

In September last year, the company had threatened to pull the plug on its plan to set up a facility in India as it wrote a letter to the Centre complaining about lack of clarity on the government’s policy for chipmakers.

“Since the government announced the new incentive scheme on December 15, the semiconductor plan is very much on paper,” said a source close to the company.

Business Standard has written to the company seeking comments. This copy will be updated when a response is received.

In December 2021, the Centre had cleared a PLI scheme for semiconductor and display board production in the country targeting an investment of Rs 76,000 crore over the next five to six years. India Semiconductor Mission (ISM) was also announced recently with the aim to attract large investments for manufacturing facilities in the midst of a global chip crisis.

“The Government of India knows exactly our recommendations, our position, and advice. We have been discussing and consulting those things with the government for more than 10 years now. I just hope they will move fast this time,” he said.

This week, Anil Agarwal-led Vedanta and Hon Hai Technology Group (also known as Foxconn) have formed a joint venture (JV) to manufacture semiconductors in India. This is the first JV in the electronics manufacturing space after the PLI policy, a joint statement issued by the companies said.