Union Cabinet Approves Rs 3,300 Crore Semiconductor Unit in Gujarat

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In a significant move towards developing a vibrant semiconductor ecosystem in India, the Union Cabinet, chaired by Prime Minister Shri Narendra Modi, has approved the proposal by Kaynes Semicon Pvt Ltd to establish a semiconductor manufacturing unit in Sanand, Gujarat. This strategic initiative is part of the broader vision to position India as a global hub for semiconductor production.

Decision Making Authority: Union Cabinet
Chaired By: Prime Minister Shri. Narendra Modi
Meeting Date: 2nd September 2024

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Key Highlights of the Semiconductor Unit

1. Investment: The proposed semiconductor unit will be set up with an investment of Rs 3,300 crore.
2. Production Capacity: The facility is expected to produce 60 lakh chips per day.
3. Applications: The chips manufactured at this unit will cater to a diverse range of industries, including industrial automation, automotive, electric vehicles, consumer electronics, telecom, and mobile phones.

Background and Significance

The establishment of this unit is part of the Government of India’s ambitious Programme for Development of Semiconductors and Display Manufacturing Ecosystem, which was announced on December 21, 2021, with a total outlay of Rs 76,000 crore. This program aims to foster a robust semiconductor ecosystem in the country, crucial for various technological advancements and economic growth.

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Previous Approvals and Progress

June 2023: The Union Cabinet approved the first semiconductor unit in Sanand, Gujarat.
February 2024: Three additional semiconductor units were approved, with Tata Electronics setting up a semiconductor fab in Dholera, Gujarat, and another unit in Morigaon, Assam. CG Power is also establishing a semiconductor unit in Sanand, Gujarat.

These four semiconductor units, including the newly approved Kaynes Semicon Pvt Ltd facility, represent a combined investment of nearly Rs 1.5 lakh crore. Collectively, they will have a production capacity of approximately 7 crore chips per day. The construction of these units is progressing rapidly, signaling the emergence of a robust semiconductor ecosystem in the vicinity.

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Impact on India’s Semiconductor Landscape

The development of these semiconductor units is a critical step in reducing India's reliance on imports for advanced technological components. By catering to the demands of various high-growth industries such as automotive, consumer electronics, and telecommunications, these units will play a vital role in enhancing India's self-reliance in semiconductor manufacturing.

The approval of Kaynes Semicon Pvt Ltd's semiconductor unit in Gujarat marks a significant milestone in India's journey towards becoming a global semiconductor manufacturing hub. With substantial investments, rapid progress in construction, and a strong focus on creating a comprehensive ecosystem, India is well on its way to achieving its goal of a self-reliant and technologically advanced economy.