After seeing the huge loss in the semiconductor industry during 2020 and 2021, countries have started to prioritize the local market and also started production within the country. According to a report, the global semiconductor industry revenues by the end of 2022 will be almost 50 percent higher than they were at the end of 2019.
As recently minister of state for electronics and information technology Rajeev Chandrasekhar shared that the government has received 23 applications for the Rs 76,000 crore production-linked incentive (PLI) scheme.
This plan had been initiated in December 2021 with the agenda to set up fab. But this task was not easier as it required long gestation and payback periods, perhaps the reason India failed to crack this space.
The domestic production of electronic goods had increased from $37 billion in 2015-16 to $74.7 billion in 2020-21, growing at a compound annual growth rate of 17.9 percent, added Chandrasekhar.
This comes on the back of several policies the government introduced, including PLI schemes, the Scheme for Promotion of Manufacturing of Electronic Components and Semiconductors, Modified Electronics Manufacturing Cluster (EMC 2.0) Scheme, taking major steps towards making India “Atma Nirbhar” (self-reliant) in electronics manufacturing, the minister said on Day 3 of the monsoon session of Parliament.
The semiconductor consumption in India was worth around Rs 1.1 lakh crore in 2020, which was met largely through imports given the absence of commercial semiconductor fabs in India, the minister said.
The minister said companies looking to manufacture 28 nanometer (nm) or lower node of chips would be eligible for getting up to a 50 percent of the project cost under the scheme.