The India Semiconductor Mission (ISM), Tata Electronics Private Limited (TEPL), and Tata Semiconductor Manufacturing Private Limited (TSMPL) have signed a Fiscal Support Agreement (FSA) to establish the country’s first commercial semiconductor fabrication unit in Dholera, Gujarat. The agreement was signed in the presence of Gujarat Chief Minister Bhupendra Patel, marking a crucial step in India’s drive towards technological self-reliance.
The Tata Electronics semiconductor fab will see an investment of over ₹91,000 crore, with a capacity of producing 50,000 wafers per month (WSPM). The Government of India, through ISM, has committed 50% fiscal support on a pari-passu basis for eligible project costs. This move underscores India’s commitment to establishing a robust semiconductor ecosystem and reducing dependency on foreign chip manufacturing.
The project is expected to generate more than 20,000 direct and indirect skilled jobs. In collaboration with Taiwan’s Powerchip Semiconductor Manufacturing Corporation (PSMC), Tata Electronics will integrate global expertise into India’s semiconductor industry. The facility will cater to the growing demands of global markets in automotive, computing, communications, and artificial intelligence (AI) sectors.
Sushil Pal, CEO of the India Semiconductor Mission, emphasized the government’s commitment to timely fiscal support, stating, “This initiative highlights India’s ambition in indigenous semiconductor manufacturing. We are confident that Tata Electronics will play a pivotal role in strengthening the electronics value chain.”
Dr. Randhir Thakur, CEO and MD of Tata Electronics, called it a “historic milestone” for India’s semiconductor industry. “The Fiscal Support Agreement solidifies our partnership with MeitY and ISM to realize our Hon’ble Prime Minister’s vision of ‘Chips for Viksit Bharat.’ Tata Electronics is committed to building India’s first AI-enabled fab in Dholera,” he added.
The establishment of the semiconductor fab is expected to significantly contribute to India’s economic growth, technological advancements, and employment generation. It also positions India as a key player in global semiconductor supply chains, reducing vulnerabilities and ensuring sustainable technological development.
