Business / Industry Sectors
Union Cabinet clears Rs. 63,000-cr proposal for semiconductor wafer facilities
10/03/2014
Array of tax incentives under the scheme; Israel’s Tower Semiconductor to build one of them

The Union Cabinet has given its approval for the establishment of two semiconductor wafer fabrication manufacturing plants aimed at encouraging electronic system design and manufacturing in India. The new FABs are expected to employ about 22,000 directly and also provide employment opportunities to about 100,000  indirectly. Taken together, the projects are expected to require more than INR 63,000 crore in investments.

In the first instance, there will be a Joint Venture between the India-based Jaiprakash Associates along with the US giant IBM and Israel’s Tower Semiconductor. The project cost for this first facility, which will be positioned on Yamuna Expressway in Uttar Pradesh, will be Rs 34,399 crore.

An official statement has revealed that the project cost for the second facility, which will be situated in Gujarat, will be Rs. 29,013 crore. HSMC Technologies India will partner with ST Microelectronics and Silterra Malaysia on this.

The planned facilities will be given a number of incentives, comprising a 25% subsidy on capital expenditure and tax repayment as part of provisions of the Modified Special Incentive Package Scheme (M-SIPS) Policy. These units will also be exempt from the basic customs duty for non-covered capital items as well as 200% deduction on expenditure on R&D. Each of these facilities will receive about Rs 5,124 crore in zero-interest loans as well.

Source: IBM News

Image courtesy: www.bing.com

 

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