India: It would be fab if Intel and TSMC built plants here

Govt offers lure of subsidies in bid to become electronics manufacturing powerhouse

India is hoping it can convince Intel and TSMC to set up fabs in the country as part of their multibillion-dollar manufacturing expansion blueprint.

Bloomberg reported Tuesday that India's government is making pitches to both companies, backed with a $10 billion subsidy plan that can be used to cover up to half of the cost of a new chipmaking plant. The plan also covers new plants for display manufacturers.

Neither Intel or TSMC have made commitments to India yet.

India's hope is to replicate China's success in building a massive manufacturing footprint for electronics.

The ambitions are part of a wider move by India's government to become a larger player in the technology world, which includes the formation of the "Trade and Technology Council" that is meant to enhance the country's relationship with the European Union.

Both Intel and TSMC are in the midst of expanding their respective manufacturing capacities across the world, efforts of which will take years before their collective impact is felt in supply chains.

These efforts include new fabs in the United States and Germany for Intel. TSMC is also building fabs in the US, and the foundry has new plants in the works in Taiwan and Japan, too.

The building spree means India must compete with other countries that are eager to reward chipmakers with incentives. The country also needs to ensure it can provide the high amount of energy, water and logistics support that are needed for such manufacturing operations.

The man in charge of convincing companies to build plants in India is Rajeev Chandrasekhar, a former Intel engineer who is now the country's minister of state for technology and entrepreneurship.

Chandrasekhar told Bloomberg that Indian states are doing their best to put forward the most attractive proposals for chipmakers.

"They are all open to sitting down and negotiating what other incentives, apart from land, they can offer investors. It is a keenly contested, keenly sought-after investment by state," he said.

Intel and TSMC already have operations in India, but no manufacturing plants. In fact, Intel CEO Pat Gelsinger recently visited the country to meet with Prime Minister Narendra Modi. ®

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