India’s semiconductor mission will be powered by green energy: Ashwini Vaishnaw

All new semiconductor manufacturing plants in India will be powered by green energy, said Ashwini Vaishnaw, Union minister of railways, communications and electronics, and information technology, at the World Economic Forum 2023 in Davos on Friday. 

“We in India are very clear that whatever new plants or fabs we set up will be served by green energy. We already have 42% of our energy from renewable sources and we want to add that advantage to semiconductor manufacturing also,” said Vaishnaw. 

Though chips are becoming more and more power efficient, their manufacturing is resource and power intensive. According to climate non-profit Greenpeace’s findings, TSMC, which accounts for 50% of global supply, also accounts for close to 5% of Taiwan’s total power consumption. 

Despite the recent slump in demand for chips in consumer electronics, there is a lot of interest in chip manufacturing in the US, India, and Japan as they look to cut import dependence on key electronic components. 

According to an April report by the Indian Electronics and Semiconductors Association (IESA), semiconductor manufacturing is an $85-100 billion opportunity for India out of the $550-600 billion global market by 2030. 

Governments in these countries are giving incentives to OEMs and chip manufacturers to set up local plants. After the production-linked incentive (PLI) scheme in smartphone manufacturing, in December 2021, India announced a ₹76,000 crore PLI scheme for semiconductor manufacturing. 

It has attracted interest from several chip manufacturing and design firms that are in the process of setting up plants in India. For instance, International Semiconductor Consortium (ISMC), a joint venture between Abu Dhabi-based Next Orbit Ventures and Israel’s Tower Semiconductor, has sought permission to set up a fab in Karnataka for 65nm chips with an investment of $3 billion. 

Foxconn and Vedanta are also planning to set up a semiconductor fab unit, a display fab unit, and a semiconductor assembling and testing unit in Gujarat with an investment of $20 billion.