Micron Technology Inc. intends to build several semiconductor assembly and packaging units in India in addition to its proposed fabrication unit, minister of state for electronics and information technology Rajeev Chandrasekhar said, as the US-based company takes a long-term view of the country as a market and manufacturing destination for semiconductors.

The minister said Micron’s first investment in India catalyzed the transition of fence sitters willing to consider the country as a serious part of their semiconductor assembly and eventually manufacturing plans; therefore, it was in the government’s interest to ensure that the company’s first plant is operational and functional at the earliest.

“If this first big investment by Micron is successful—and it is our job and duty to make it successful—two things happen as a consequence. One, it acts as a beacon for other companies and other investments to come to Dholera or anywhere else. Second, those who come to India see the value in growing what they already have to reach even higher levels of scale. So, from a point of view, it is certainly a possible roadmap for growth. He’s absolutely right, and we’re absolutely clear about that in our mind," the minister said in an interview last week.

The minister was referring to Micron chief executive officer Sanjay Mehrotra’s comments at the Semicon India 2023 in July that the semiconductor and packaging major will undertake the next phase of its expansion in the second half of the decade. The company has announced an investment of $800 million to set up a semiconductor assembly, testing, marking and packaging (ATMP) unit in Gujarat’s Sanand. Officials aware of the company’s plans said more such units would come up after the first one becomes operational.

“We’ve created the policy framework and got a global major that will start with packaging and potentially can go into fabs in the organic four to five years," the minister said. He added that the government was talking to all entities in the semiconductor market, noting engagement levels had risen multifold from those which were previously not keen on India to be actively interested and participate in discussions.

He went on to add that fabs, including packaging units, typically come up in large numbers in areas where they’re first set up, giving the example of Malaysia and Japan, which have become ATMP hubs triggered by investments from single companies over the years. “If you look at the history of how fabs and packaging units have developed anywhere in the world, they start with one, and unless something terribly bad happens in the environment or the government policies, they almost always get into an expanding to multi-factory, multi-fab, multi-packaging unit, large complexes," he said.

The government is giving financial assistance of about $1.95 billion to Micron, taking the total investment into the project to $2.75 billion. Construction of the facility is expected to begin this year, and the first phase of the project will be operational in late 2024.

The government has publicly said that the first chip from India is expected to be out by December 2024.

The second phase, set to start in the latter half of the decade, will create as many as 5,000 new direct jobs at Micron together with the first phase.

By: DocMemory
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