Even as the government's announcement on Intel's chip testing unit in India is yet to take-off, SemIndia, a consortium of overseas Indians, on Wednesday announced plans to invest $3 billion in an advanced semiconductor manufacturing facility in the country with technology from America's Advanced Micro Devices Inc.
The project, which is a public-private partnership, is expected to take-off next year and will lead to a world-class industry in India to meet domestic and global demands of semiconductor chips for cell phones, PCs, set-top boxes among others, Vinod Agarwal, CEO of SemIndia said here.
The Union government (the IT ministry) as well as the state government (where the plant will be located) can be equity partners in the project.
In any public-private partnership, government (central or state) can hold up to 24 per cent equity, according to the Indian Companies Act.
AMD will transfer high-end micro processor and logic manufacturing technology to SemIndia, and may pick up a stake in the proposed plant, Hector Ruiz, chief executive officer of AMD Inc said.
Agarwal said the plant would be funded through a mix of options, including venture capital, debt financing and strategic partnership and IT department and the state govenrment for plant location. SemIndia sees Indian demand for semiconductor chips at $30 billion each year by 2015.
Union IT Minister Dayanidhi Maran said after the details of the programme are chalked out including equity partnerships and other details like locations, he would again approach finance minister for incentives and stake holding.
However, Wednesday's announcement is only a roadmap. SemIndia neither announced the location of the plant nor the exact details on financing of such a huge project and the specific time of starting the project.
Generally, a plant of this size would be operational in two to three years' time, Agarwal said. The plant would make with a circuitry width of 65 and 90 nanometers.
The domestic market for chips is estimated at $800 million by the end of the year, and industry officials have said India has a chance of competing with heavyweights China and Taiwan to garner a share of the global $220-billion chip pie.
Maran, had in June, said that top chipmaker Intel would invest $400 million to assemble and test chips in India, but even after six months, there has been no communication from the chip giant in this regard.
Ruiz said: "This is a bold step by India and the initiative is designed to bring semiconductor manufacturing capabilities to India. "We plan to create customised products for the Indian markets," he said.
"The idea is to bring down the (chips) price so that everyone in India can use computing."
Through its agreement with SemIndia, AMD will cover manufacturing, technology licensing, business development to meet the growing demand for computer based ' X86' microprocessor in India.
