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India unveils $10.2B plan to attract semiconductor makers:
India on Wednesday announced a $10.2 billion plan to try to attract global chipmakers to set up shop in the country and transform it into a production hub of semiconductors.
The plan unveiled by Information Technology and Telecom Minister Ashwini Vaishnaw comes amid a severe shortage of semiconductors caused by the COVID-19 pandemic, which has led to global shortages of products that need them, including new cars.
India wants to lure countries with economic incentives, including manufacturers with operations in China that might be willing to shift to India because of the ongoing trade disputes between the U.S. and China, Indian officials and business leaders have said.
He told reporters that incentives will attract companies involved in various parts of the semiconductor manufacturing process. India's government will provide fiscal support of up to 50% of project costs to eligible display and semiconductor fabricators, Vaishnaw said.
(Score: 2, Interesting) by Anonymous Coward on Wednesday December 29 2021, @06:30PM (5 children)
From the only letter responding to this short post, https://swarajyamag.com/technology/facts-fallacies-and-future-of-fabinindia-efforts [swarajyamag.com] Note the mention of TATA, one of the huge Indian conglomerates.
(Score: 1) by khallow on Wednesday December 29 2021, @06:49PM (4 children)
This is the Enron clause. Much of the losses that Enron was hiding at the time of its bankruptcy was due to a coal power plant [corpwatch.org] in India. They allegedly burned $3 billion on it and lost most of that investment (and maybe much more). The factor that made it go through was a clause that the local state would buy power from the plant at 20 times [wikipedia.org] what was paid for hydroelectric power. This buy local clause got reversed when a new faction was elected to the state government.
(Score: 0) by Anonymous Coward on Wednesday December 29 2021, @07:02PM (3 children)
'Splain this to me please. I don't see any connection to Enron's failed power plant.
The blog comment is about rules in India that force outside companies to buy from Indian suppliers. For lower-tech industries, this kind of makes sense, mandate development of the local suppliers (even when it might be cheaper to buy raw materials from outside India).
However, since there is no semi-conductor industry in India, a new fab will have to import most of the supplies, from high purity silicon (or pre-cut 300mm wafers) to all the various chemicals required. And of course all the high tech machinery, clean-room tech and etc required to build the facility in the first place will also have to be imported.
(Score: 1) by khallow on Thursday December 30 2021, @02:08AM
The Enron example went both ways. Construction was by Indian suppliers. Similarly, where's the incentive to get in on this action? If there's supply-side restrictions, there will be demand-incentives to make up for it.
(Score: 1) by khallow on Thursday December 30 2021, @02:30AM (1 child)
(Score: 0) by Anonymous Coward on Thursday December 30 2021, @10:37AM
It's more like the major items were reversed for the Enron deal (compared to the blog comment).
+ Enron had a mandated market (India had to buy the power at a high price).
+ Blog suggests that Intel (or whoever) should be able to import raw materials and machinery with zero import fees. Sales of completed chips will be to the Indian market, at market rates.
Or maybe the better point is that India, as it stands now, is far from a free market. In my experience (over the years, most recent was last month) their controls on import and export are crazy, not only large fees, but also ridiculous inspectors. My recent example, a shipment of some samples to USA (for testing) was denied export permission because the airfreight cost (for a small pallet) exceeded the declared value of the samples. This was deemed "irregular" and the samples went back to point of origin for still more paperwork!