Karnataka bags Rs 23k crore investment from ISMC for India’s first semiconductor plant

International semiconductor consortium ISMC will invest $3 billion (around Rs 23,000 crore) in Karnataka to set up a chip-making plant, the state government said on Sunday.

ISMC is a joint venture between Abu Dhabi-based Next Orbit Ventures and Israel’s Tower Semiconductor. US chip giant Intel Corp has announced plans to acquire Tower.

India’s first semiconductor fabrication unit is expected to generate more than 1,500 direct jobs and 10,000 indirect jobs, the state’s investment promotion division said in a tweet.

Also Read | Vedanta in talks to raise up to $3 billion debt in semiconductors push

ISMC and Indian conglomerate Vedanta Ltd have applied for Prime Minister Narendra Modi’s $10 billion (Rs 76,523 crore) incentive plan to push companies to set up semiconductor and display operations in India, the government’s next big bet on electronics manufacturing.

Vedanta told Reuters on Saturday it was in “advanced talks” with Gujarat, Maharashtra and Telangana to choose a site by mid-May. It has a planned investment outlay of $20 billion (1.53 lakh crore) for its semiconductor and display push.

Modi and his IT ministers outlined plans on Friday for investment incentives in the sector, saying they want India to become a key player in a global chip market dominated by manufacturers in Taiwan and a few other countries.

India’s semiconductor market is forecast to grow to $63 billion (Rs 4.82 lakh crore) (by 2026 [Rs 1.14 lakh crore] from $15 billion in 2020, the government says.

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