By Munsif Vengattil
NEW DELHI (Reuters) -India is expecting to court a total investment of at least $25 billion as a result of its incentive scheme meant to boost local manufacturing of chip and display panels, junior IT minister Rajeev Chandrasekhar told reporters on Wednesday.
His comments came hours after the Indian government raised fiscal support for new semiconductor facilities to cover 50% of project costs, and said it will remove a ceiling for maximum permitted investment to enable incentives for display manufacturing.
Prime Minister Narendra Modi’s government is seeking to attract more big-ticket investments under a $10 billion incentive plan for chip and display production, aiming to make India a key player in the global supply chain.
The government had previously agreed to cover between 30% and 50% of the cost of setting up new display and chip plants. It said on Wednesday that it will also cover 50% of the capital expenditure required to set up semiconductor packaging facilities.
Chandrasekhar said the government is in conversations with many of the global players to invest in India’s chip sector, without naming any.
“These conversations are happening in the context of multiple incentive packages and programs that have been announced by various countries,” Chandrasekhar said.
“Our proposition is … we have a proven track record of growing the electronics industry. And we also come along with the basic infrastructure requirement to set up manufacturing,” he added.
Last week, oil-to-metals conglomerate Vedanta and Taiwan’s Foxconn signed a pact with India’s Gujarat to invest $19.5 billion in the western state to set up semiconductor and display production plants.
Vedanta is the third company to announce a chip plant location in India after international consortium ISMC and Singapore-based IGSS Ventures, which are setting up in the southern states Karnataka and Tamil Nadu respectively.
(Reporting by Munsif Vengattil in New Delhi; Editing by Louise Heavens, Jan Harvey and Jonathan Oatis)