Chip makers may see fund rush soon

BANGALORE: A Slew of announcements for committing investments in the Indian semiconductor manufacturing sector in the next few months is expected, according to the Indian Semiconductor Association (ISA). This follows the announcement of the Semiconductor Policy on Thursday by the Union government.

Rajendra Khare, chairman, ISA, welcoming the policy, said, “The domestic electronics market is growing rapidly. Reports suggest that about 28% of the country’s economy will be effected by this sector in future. We will see investment coming in soon.” Players have been waiting in the wings for the policy before announcing their manufacturing plans in India, he added.

One of them is Hindustan Semiconductor Manufacturing (HSMC) led by Devendra Verma. The company intends to invest $4.5 billion to set up a joint venture in India for semiconductor manufacturing. The group will tie up with a global major, one of the top five multinationals in this segment, to set up two fab units. The JV is likely to be announced within three weeks, said Mr Verma.

On whether the policy will have any effects on the existing design companies in India, Mr Khare said that manufacturing units will help build an ecosystem including testing and packaging units. “Apart from that, we expect the current pure design companies here to expand and grow. They will also bring in their product engineering to India,” he added.