Prime Minister Narendra Modi’s cabinet on Wednesday approved 1.28 trillion rupees in state aid for semiconductors and 625 billion rupees for phones, technology minister Ashwini Vaishnaw told reporters in New Delhi. The twin incentives are part of broader tech subsidies offered by the federal government as it seeks to attract more research, development and manufacturing to the world’s most populous country.
The new chip initiative will build on India’s previous $10 billion program from 2021, which offered to bear half the cost of setting up semiconductor projects. That effort helped kickstart India’s chip journey, drawing companies including US memory maker Micron Technology Inc. and salt-to-software conglomerate Tata Group to western Gujarat state. The incentives are aimed at areas such as chip designing, fabrication of machines, research and development as well as creating talent, Vaishnaw said.
Modi is trying to bolster India’s chip campaign, which is in early stages with a handful of major projects under way. Governments around the world are ramping up support for their chip industries to become more self-sustaining and fulfill rising demand from developers of everything from artificial intelligence and smartphones to cars and appliances.
India’s push, though nascent, is similar to the $52 billion US Chips and Science Act that funds local chipmaking capacity. In China, authorities provide funding for semiconductor firms in part through giant investment vehicles that back key companies across the ecosystem.
India is hoping to woo major chipmakers to the country with its engineering, design talent as well as subsidies in much the same way it’s helped Apple Inc. expand in the region. The US tech giant now assembles 25% of its iPhones in the South Asian nation, thanks to Modi’s production-linked subsidies offered to companies including Apple suppliers during the Covid pandemic.
The new smartphone subsidies will also be used to support mobile production by Indian companies in a market dominated by Chinese brands.
“The Prime Minister has given us clear guidance that we must help create an Indian mobile brand,” Vaishnaw said.
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Prime Minister Narendra Modi’s cabinet on Wednesday approved 1.28 trillion rupees in state aid for semiconductors and 625 billion rupees for phones, technology minister Ashwini Vaishnaw told reporters in New Delhi. The twin incentives are part of broader tech subsidies offered by the federal government as it seeks to attract more research, development and manufacturing to the world’s most populous country.
The new chip initiative will build on India’s previous $10 billion program from 2021, which offered to bear half the cost of setting up semiconductor projects. That effort helped kickstart India’s chip journey, drawing companies including US memory maker Micron Technology Inc. and salt-to-software conglomerate Tata Group to western Gujarat state. The incentives are aimed at areas such as chip designing, fabrication of machines, research and development as well as creating talent, Vaishnaw said.
Modi is trying to bolster India’s chip campaign, which is in early stages with a handful of major projects under way. Governments around the world are ramping up support for their chip industries to become more self-sustaining and fulfill rising demand from developers of everything from artificial intelligence and smartphones to cars and appliances.
India’s push, though nascent, is similar to the $52 billion US Chips and Science Act that funds local chipmaking capacity. In China, authorities provide funding for semiconductor firms in part through giant investment vehicles that back key companies across the ecosystem.
India is hoping to woo major chipmakers to the country with its engineering, design talent as well as subsidies in much the same way it’s helped Apple Inc. expand in the region. The US tech giant now assembles 25% of its iPhones in the South Asian nation, thanks to Modi’s production-linked subsidies offered to companies including Apple suppliers during the Covid pandemic.
The new smartphone subsidies will also be used to support mobile production by Indian companies in a market dominated by Chinese brands.
“The Prime Minister has given us clear guidance that we must help create an Indian mobile brand,” Vaishnaw said.
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