Singapore-based IGSS Ventures will build a hi-tech semiconductor park including a manufacturing unit in Tamil Nadu with an investment of Rs 25,600 crore, a shot in the arm for the state government, which is courting big players in the emerging sector to set up shop .
While the semiconductor manufacturing unit will provide jobs for 1,500 people, the ecosystem supporting the Semiconductor Outsourcing and Testing Facility (OSATS) emerging in the park will provide jobs for about 25,000 people.
Senior sources told DH that the high-tech park will be built near Chennai, the state capital, on an area of 300 acres. “Guidance Tamil Nadu and IGSS Ventures are working together to identify the site,” a top source said.
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A Memorandum of Understanding (MoU) between IGSS Ventures and Guidance Tamil Nadu to set up the huge factory was signed at the Secretariat on Friday in the presence of Chief Minister MK Stalin.
The development comes a week after the Tamil Nadu government held talks with top management at Foxconn, which makes high-end Apple iPhones at its Sriperumbudur plant, over plans to invest in the semiconductor sector.
In addition to Foxconn, the Tamil Nadu government has invited Samsung and local company Tata Electronics (OSAT) to invest in the state.
According to an official government statement, IGSS Ventures will open its semiconductor fab under the name “Project Suria”. “The company plans to invest Rs 25,600 crore and create jobs for 1,500 people over the next five years. Since the park will have an Outsourcing and Testing Semiconductor (OSATS) facility, among other facilities, the ecosystem supporting these facilities will employ an additional 25,000 people,” the statement said.
Tamil Nadu believes it is well positioned to attract large investments in this sector as it is home to some of the country’s largest automotive companies and accounts for 20 percent of the national electronics and hardware production.
Tamil Nadu feels it is in an “advantageous position” in attracting investment in the semiconductor sector given the market it offers in the automotive and electronics sectors – several giants have manufacturing facilities here – which require computer chips.
The state has approached interested companies to take advantage of the center’s Rs 76,000 Product Linked Incentive (PLI) scheme for semiconductor manufacturing in India and set up units in Tamil Nadu.
Industry Minister Thangam Thennarasu told DH in an interview in January that the state had contacted several companies to manufacture chips in the state. “Because Foxconn is a large electronics manufacturer, we officially invited them to invest in the semiconductor sector. The company has been operating here for over a decade and knows the state well,” Thenarasu had said.
Tamil Nadu, which released an exclusive policy for electronics and hardware manufacturing in 2020, has set a target of contributing 25 percent of India’s total electronic exports to the world and growing the industry’s output to US$100 billion by 2025 .