$7-bn investments cleared for Fab City

The Union government has cleared seven projects, estimated to fetch a combined investment of about $7 billion over the next 10 years to the "Fab City" project in Hyderabad.

However, a bulk of the investments is being made in solar-photovoltaic module manufacturing plants.

"It is now up to the companies to make the investments. Even the land sought by them is in their possession," Union Minister of State for Commerce Jairam Ramesh said on Sunday.

Speaking to reporters on the sidelines of the India Semiconductor Association (ISA) Vision Summit 2008, the minister also pointed out that five more companies had been given in-principle approval to set up solar-photovoltaic module manufacturing plants in the "Fab City".

However, these companies have to fulfill certain requirements based on which the allotment of land will be made.

Meanwhile, companies like Reliance Industries and Vedanta have evinced interest but are yet to make formal proposals.

The Mukesh Ambani-controlled Reliance Industries Ltd has evinced interest in setting up a "sand-to-silicon" complex in either western Maharashtra or Jamnagar (Gujarat) with an investment in excess of $5 billion.

"So far, RIL has not submitted any application formally to the government. But we are given to understand that they are very keen on setting up large facilities to manufacture various products," said Ramesh.

The product range could be from photovoltaic modules to high-end chipsets for the electronics industry.

The seven companies whose applications have been cleared also include Sem India. Its $3-billion project spread over 100 acres will start with an "assemble- test- mark- pack" plant followed by chip manufacturing facilities in the second phase (three years from now).

Sem India is the only company that has committed to manufacture chipsets. The remaining six are setting up photovoltaic-module manufacturing plants.

Solar Semiconductor plans to invest $1 billion (50 acres), Titan Energy Systems $750 million (50 acres), Nano Tech Solutions India $2 billion (50 acres), XL Telecommunications and Energy $75 million (50 acres), KSK Energy Ventures $70 million (50 acres) and Embedded IT Solutions $5 million (10 acres).

The five companies, which have been given in-principle approval, have proposed to invest a combined $800 million. They include Chandradeep Solar (3 acres), Neotech Solutions (10 acres), Photon Energy Systems (10 acres), Surana Ventures (25 acres) and Ram Terra Solar (25 acres).

Ramesh said three applications submitted by Videocon Industries, Moser Baer and Hindustan Semiconductor Manufacturing Corporation (HSMC) are being considered by the government.

While Videocon plans to invest $250 million, it is yet to finalise the location. Moser Baer intends to invest $2 billion at Sriperambudur in Tamil Nadu.

"HSMC has proposed to invest $1 billion, but is yet to identify the place. All the three applications being considered are related to solar-photovoltaic modules manufacturing plants," Ramesh added.

The minister said all the 15 applications were filed after the government announced the new semiconductor policy last year.

"The government will support the industries by way of incentives if the applications are filed before 2010," he added.