Prime Minister Narendra Modi laid the foundation stones for three new semiconductor plants in India on Wednesday. He further expressed that the semiconductor revolution in India will shortly start commercial semiconductor production and connected products and will become a global power in this sector, similar to the nuclear, technology, and digital spaces.
On the occasion, PM Modi also addressed the youth across the nation and said that this is a historic day for the nation. Prime Minister Modi said, “Today’s projects will play a pivotal role in making India a semiconductor hub.”
The semiconductor revolution in India is a game-changing step that can transform the country’s innovation, economy, and global influence.
“India’s Techade: Chips for Viksit Bharat”:
At “India’s Techade: Chips for Viksit Bharat” in Dholera, Prime Minister Narendra Modi addressed the nation via videoconferencing and laid the three foundation stones. Two are in Gujarat and one in Assam, and they are valued at approximately Rs1.25 lakh.
In his 25-minute speech, he said, “India has left behind old thoughts and old approaches and has moved much ahead. India is making speedy decisions and making policies. We have lost decades in semiconductor manufacturing. But we should not lose a single moment now.”
Admitting the crucial role of electronic chips in the 21st-century tech industry, Modi said that “Designed in India” and “Made in India” chips will play a significant role in moving India towards modernisation and self-reliance.
He also added, “In the 60s, India had dreamed of semiconductor manufacturing and thought in this direction. But governments then could not take advantage of the possibilities that existed before us. The biggest reason for this was a lack of making bold decisions for the country, a lack of effort, and a lack of will to convert the thoughts into action. Due to this, for many years, India’s dream of making semiconductors remained a dream.”
The future of semiconductors is in sequence with the government’s current push to make the nation a hub for assembling and manufacturing semiconductors. This is a key ingredient in a huge area of technology sectors, but one whose supply was first disturbed by the pandemic and, after that, geopolitical tensions between China and the US.
The Semiconductor Revolution In India:
Semiconductors, the invention of the transistor, are small devices that control the electricity flow in electronic circuits. They are the building blocks of modern technology, enabling the operation of everything from smartphones and laptops to missiles and satellites. They are also vital for the establishment of AI, which is anticipated to be the next frontier of human progress.
The semiconductor sector is, therefore, lucrative and strategic, with a global market area of over $500 billion. However, it is also much more complex and competitive, requiring sophisticated infrastructure, huge investments, and advanced skills.
Only a handful of countries, such as the US, Taiwan, and China, have the capacity and capability to develop semiconductors at scale. India was not one of them until recently. However, this is going to change very soon.
Plant Locations:
The entry of the semiconductor revolution in India is timely. The nation’s historical missed chances during the industrial transformations make the recent strike into semiconductor manufacturing a critical step in recovering its position on the technological stage worldwide.
The prime minister’s vision aligns with the wider Industrial 4.0 revolution. India aims to strengthen its extensive technological prowess and talent pool to become a vital player in the semiconductor domain.
Now, let us now look at the plant locations briefly.
Semiconductor Fabrication Facility at DSIR, Gujarat:
A joint venture between Taiwan’s Powerchip Semiconductor Manufacturing Corporation (PSMC) and Tata Electronics Private Limited (TEPL). This project also marks the first commercial semiconductor fab in India. By 2026, it also aims to commence production of 28-nanometer chips. With an investment surpassing Rs 91,000 crore, it will also create around 20,000 skilled jobs. This provision is all set to offer to diverse sectors, including high-power computing, telecom, and electric vehicles.
OSAT Facility in Morigaon, Assam:
This greenfield project by TEPL has an investment of around Rs 27,000 crore. It also validates the semiconductor revolution in India. It is anticipated to develop employment for more than 30,000 people.
This was done by reflecting an inventive shift for the Northeast region and Assam, which were once known for insurgency. However, they are now on the path of becoming an epicenter of significant technological and investment development.
OSAT Facility In Sanand, Gujarat:
Developed by Industrial Solutions Limited and C G Power with an investment of Rs 7,600 crore. This facility will further strengthen the manufacturing capabilities of the semiconductor revolution in India. By contributing to the country’s aim to become a global hub for semiconductor manufacturing, design, and technology development.
The Semiconductor Revolution In India Is Set To Generate 80,000 Jobs:
Prime Minister Narendra Modi said, “India is set to become a well-known semiconductor manufacturing hub. The three facilities will drive economic growth and foster invention.”
He further added, “Today, the youth are seeing how India is working all around for self-reliance, progress, and its presence in the global supply chain. These efforts will also increase their self-confidence, and wherever a confident youth is, he changes the destiny of his country.”
According to the government, these establishments will help boost the semiconductor revolution in India. Additionally, they will generate thousands of jobs in the semiconductor industry and catalyze employment in related areas like telecom and electronics.
According to some estimations, the importance of semiconductor technology can be seen in these three units that are anticipated to develop direct employment of 20,000 advanced jobs in the tech industry. It will also create 60,000 indirect jobs.
Semiconductor Sectors Stocks to Watch:
The semiconductor deal is beneficial for India’s technology and economy, as well as for the stock market. The deal announcement has already boosted companies’ share prices and those of related companies. Below are the two stocks that you should keep an eye on, as they can surely benefit from the semiconductor surge:
Tata Elxsi:
Tata Elxsi is a popular provider of technology and design services worldwide with an emphasis on embedded product design. It serves multiple industries, including consumer electronics, transportation, healthcare, and media. It has a robust presence in the semiconductor industry, providing validation services, chip design, and verification.
Tata Elxsi also has a partnership with Powerchip, a Taiwanese company that will partner with Tata Group for the Gujarat plant. Tata Elxsi has displayed impressive yet consistent growth in its earnings and revenue despite the high PEG and PE ratios. It is one of the top-notch stocks in Tata’s portfolio. Also, it could further gain from the semiconductor agreement.
C G Power:
C G Power is a complete solutions provider for multiple industries, such as renewables, industrial, power, and railways. Its industrial systems elements, including automation, motors, drives, and generators, generate a vast revenue share.
Additionally, it has an appearance in the semiconductor area, offering assembly, chip fabrication, and testing services. It also has a partnership with companies from Thailand and Japan, which will collaborate with C G Power for the Gujarat plant.
C G Power’s earnings and revenue performance have been volatile and mixed, with debt levels and high valuations. Also, it is one of the most speculative and risky stocks in the semiconductor industry, but it could provide high rewards if the deal advances.
Final Line:
The inauguration of the semiconductor projects by India PM Narendra Modi marks a historic day for the nation. The Semiconductor Revolution in India is beginning a new era of global collaboration, technological collaboration, and economic growth. As the nation steps onto the global stage of semiconductors, the promise of “India’s Techade” is bringing closer the vision of a self-sustaining, technologically advanced country envisioned to play a strong role in shaping global technology’s future.
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