Cabinet Approves Fifth Semiconductor Unit in India with ₹3,307 Crore Investment
The Union Cabinet has approved Kaynes Semicon’s proposal to set up a semiconductor unit in
Sanand, Gujarat, with an investment of ₹3,307 crore (US$394.15 million), marking the fifth such
unit under the India Semiconductor Mission (ISM). The new facility, which will focus on
assembly, testing, marking, and packaging (ATMP) of semiconductors, aims to produce 6
million chips daily for industries like automobiles, electric vehicles, telecom, and consumer
electronics. This brings the total investment under the ISM to ₹1,52,307 crore (US$18.15
billion). Minister Ashwini Vaishnaw described the semiconductor industry as foundational for
India’s domestic manufacturing ambitions.
Kaynes Semicon’s facility will be built on a 47-50 acre site and is expected to release its first
packaged chip by March 31, 2025. CEO Raghu Panicker said structural tests and soil testing are
complete, with construction set to begin imminently. Kaynes has partnered with global
technology leaders from Malaysia, Taiwan, and Japan for expertise and training and has already
secured three customers, including Singapore-based Lightspeed Photonics. The project is
expected to employ 500 people by March 2025, with 35 key hires and 15 expatriates already
onboard.
https://www.hindustantimes.com/india-news/cabinet-approves-fifth-semiconductor-unit-in-india-
101725290494316.html
Editor’s Note: The Union Cabinet has approved Kaynes Semicon’s plan to establish a
semiconductor unit in Sanand, Gujarat, with an investment of ₹3,307 crore (US$394.15
million). This facility will focus on the assembly, testing, marking, and packaging of
semiconductors, aiming to produce 6 million chips daily and contributing to India’s
semiconductor ecosystem. Construction is set to begin soon, with the first packaged chip
expected by March 31, 2025, and the project will create 500 jobs by then.
Telangana and Tamil Nadu Lead GSDP Growth Among Top 10 Indian States
Telangana, Tamil Nadu, and Rajasthan have emerged as the fastest-growing economies in FY24
among India’s 10 largest states by gross state domestic product (GSDP), according to data from
the Ministry of Statistics and Programme Implementation (MoSPI). Telangana, the ninth-largest
state, posted a GSDP growth of 9.2%, reaching ₹7.9 lakh crore, surpassing the national GDP
growth rate of 8.2%. Tamil Nadu, the third-largest state, grew its economy by 8.2% to ₹15.7 lakh
crore, while Rajasthan, in seventh place, saw an 8% growth.
Sectoral analysis shows the services sector played a critical role in the growth of these states,
with Tamil Nadu’s services sector contributing 52% to the state’s gross value added (GVA) and
growing at 9%, while Telangana’s services sector, holding a 63% share, grew 11%. Maharashtra,
despite being the largest economy at ₹24.1 lakh crore GSDP, saw its services sector growth slow
to 9%, a dip from 13% in FY23. Gujarat is expected to retain its second spot based on budget
estimates, while Uttar Pradesh and Karnataka are nearly tied in the fourth and fifth positions,
respectively.
https://www.thehindubusinessline.com/data-stories/data-focus/telangana-and-tamil-nadu-top-in-
gsdp-growth-among-the-largest-states/article68601808.ece
Editor’s Note: Telangana and Tamil Nadu have emerged as the top performers in GSDP
growth among India’s 10 largest states for FY24, with Telangana achieving a 9.2% increase
and Tamil Nadu an 8.2% rise. The robust growth in these states, driven largely by their
dynamic services sectors, outpaced the national GDP growth rate of 8.2%, highlighting
their significant economic momentum.
Reliance Jio’s Ambitious AI Strategy Set to Challenge Big Tech Dominance
Reliance Jio, led by Mukesh Ambani, is positioning itself as a deep tech company with a bold
focus on artificial intelligence (AI), aiming to disrupt the stronghold of global tech giants.
Following its success in revolutionizing India’s telecommunications sector, Jio has introduced
100GB of free cloud storage to challenge Google One and Apple’s iCloud, a move likely to
shake up the cloud storage market. While this offering may pressure competitors to lower prices,
experts like Neil Shah of Counterpoint Research note that integrating Jio Cloud into existing app
ecosystems dominated by Google and Apple will be a significant challenge. Moreover, Reliance
plans to leverage data from its cloud services, including features like call recording and
transcription, to gather Indic language data for training its AI models, with an emphasis on user
consent.
Jio’s AI ambitions are further bolstered by plans to build a Gigawatt-scale AI-ready data centre
in Jamnagar, Gujarat, powered by renewable energy. This ₹25,000 crore facility is expected to
surpass the combined capacity of all data centres in India, though it may take up to three years to
become operational. Experts like Sameer Dhanrajani of AIQRATE emphasize the importance of
partnerships with global AI leaders such as OpenAI, Meta, and Google to compete with
hyperscalers like AWS and Azure. As India’s public cloud market is projected to reach $26.1
billion by 2027, Reliance’s entry as a cloud player provides a domestic alternative for enterprises
seeking to diversify their cloud strategies, potentially reshaping the tech landscape in India.
Editor’s Note: Reliance Jio, under Mukesh Ambani, is aiming to disrupt the dominance of
global tech giants by aggressively pursuing artificial intelligence and cloud storage
innovations. The company has introduced 100GB of free cloud storage to compete with
Google One and Apple’s iCloud, while also planning a massive AI-ready data center in
Gujarat to enhance its capabilities. Jio’s strategy includes leveraging data for AI
development and seeking partnerships with global tech leaders to challenge established
cloud providers, potentially reshaping India’s tech landscape as the public cloud market
grows.
India Increases Chip Production Incentives to $15 Billion Amid Push for Semiconductor
Self-Reliance
The Indian government is set to raise its chip manufacturing incentive policy, boosting the
funding outlay for the second phase to $15 billion, up from the $10 billion allocated in the first
phase. This increase coincides with Tata Group’s ongoing construction of India’s first
commercial semiconductor fabrication plant, in collaboration with Taiwan’s Powerchip
Semiconductor Manufacturing Corporation (PSMC), a project estimated to cost over ₹91,000
crore. In addition, three Assembly, Testing, Marking, and Packaging (ATMP) and Outsourced
Semiconductor Assembly and Test (OSAT) plants have been approved, including facilities by
Micron Technology, Tata Group, and CG Power in partnership with Japan’s Renesas
Electronics, with total investments surpassing ₹1.48 lakh crore.
These government-backed initiatives are part of India’s strategic effort to reduce dependence on
foreign chipmakers and strengthen its semiconductor supply chain amid global geopolitical
tensions. While India’s current chip production is minimal, the government’s substantial
subsidies and state incentives like discounted land and electricity rates are expected to attract key
investments. However, the Tata-PSMC plant will not produce advanced node chips due to
technological limitations, an area where companies like Taiwan’s TSMC hold a significant edge.
Despite these challenges, establishing domestic chip fabrication is critical to India’s economic
and strategic goals, spanning industries from aerospace to consumer electronics.
https://swarajyamag.com/news-brief/india-plans-to-raise-the-stakes-in-chip-production-with-
new-15-billion-incentives
Editor’s Note: India is increasing its chip manufacturing incentives to $15 billion in the
second phase of its semiconductor push, up from $10 billion previously allocated. Thisboost supports Tata Group’s construction of India’s first commercial semiconductor
fabrication plant in collaboration with Taiwan’s Powerchip Semiconductor Manufacturing
Corporation, alongside the approval of several ATMP and OSAT plants by major firms.
Despite the challenge of not producing advanced node chips, these initiatives aim to reduce
foreign dependency and bolster India’s semiconductor capabilities, impacting a range of
industries from aerospace to consumer electronics.
India and Singapore to Sign Landmark Semiconductor Pact During PM Modi’s Visit
India and Singapore are poised to ink a major agreement on semiconductor cooperation during
Prime Minister Narendra Modi’s visit to Singapore on September 4-5. PM Modi will meet with
Singapore’s newly elected President Tharman Shanmugaratnam and Prime Minister Lawrence
Wong as part of the trip. The pact aims to boost collaboration in the semiconductor sector, a
critical area of focus for both nations, as India continues to strengthen ties with global partners to
build a robust semiconductor ecosystem.
This agreement comes amid India’s growing efforts to collaborate with key players like the US,
Taiwan, and the EU in the semiconductor space. Notable initiatives include a partnership
between Purdue University and the India Semiconductor Mission, and a joint venture between
Tata Electronics and Taiwan’s Powerchip Semiconductor Manufacturing Corporation (PSMC),
which has led to the construction of India’s first commercial semiconductor fab in Dholera,
Gujarat. The new pact with Singapore is expected to further enhance India’s global footprint in
semiconductor manufacturing.
https://www.wionews.com/india-news/india-singapore-to-sign-pact-on-semiconductors-during-
pm-modis-visit-755029
Editor’s Note: India and Singapore are set to sign a significant semiconductor cooperation
agreement during Prime Minister Narendra Modi’s visit to Singapore on September 4-5,
aimed at strengthening ties in this crucial sector. This pact, alongside existing
collaborations with the US, Taiwan, and the EU, is expected to further bolster India’s
position in the global semiconductor ecosystem.
Southern Indian States Compete to Attract Foxconn’s ‘Foxconn City’ with Massive Land
Offers
Foxconn, a leading global electronics manufacturer and key supplier for Apple, is being courted
by multiple Indian states to set up large-scale industrial facilities akin to its ‘Foxconn City’ in
China. Telangana has proposed a 2,000-acre site for the project, with the state’s IT and industries
minister, Duddilla Sridhar Babu, revealing that Foxconn’s subsidiaries and suppliers from
Taiwan, China, and the US could potentially set up operations there. Andhra Pradesh and
Karnataka are also competing for Foxconn’s attention, with Andhra Pradesh offering 2,500 acres
for an industrial park, while Karnataka has proposed 300 acres for a supplier park.
Foxconn’s interest in India continues to grow, with its chairman, Young Liu, expressing plans for
an ‘industrial township’ near Chennai during a recent event in Tamil Nadu. The precise locations
of the land offers from Andhra Pradesh and Karnataka have not yet been disclosed. With
Foxconn expanding its presence in India, the competition among southern states highlights the
importance of securing large-scale investments to boost local manufacturing and create jobs in
the region.
https://timesofindia.indiatimes.com/business/india-business/foxconn-city-similar-to-china-
coming-up-in-india-soon-southern-states-vie-for-apples-iphone-makers-
attention/articleshow/112859889.cms
Editor’s Note: Southern Indian states are competing fiercely to attract Foxconn’s planned
‘Foxconn City,’ with Telangana offering a 2,000-acre site, Andhra Pradesh proposing 2,500
acres for an industrial park, and Karnataka suggesting 300 acres for a supplier park.
Foxconn’s chairman, Young Liu, has also indicated interest in establishing an ‘industrial
township’ near Chennai, reflecting the company’s expanding presence in India. This
intense competition underscores the strategic importance of securing such large-scale
investments to enhance local manufacturing and job creation.