Cabinet approves Kaynes' ₹3,307 cr semiconductor plant in Gujarat

The central cabinet has approved a ₹3,307 crore semiconductor Assembly, Testing, Marking, and Packaging (ATMP) unit in Sanand, Gujarat, the union minister Ashwini Vaishnaw informed in a media briefing on September 2. Speaking at the event, the minister says the country is steadily building a comprehensive semiconductor ecosystem.

"Today, the Cabinet has approved Kaynes' plant, with a capacity of 6.3 million chips per day. The plant will come up in 46 acres, it is a big plant, and a large portion of the production will go for Kaynes Industries, it has already been booked," the Union Minister of Electronics & Information Technology says at the press conference.

Kaynes Technology, an integrated electronics manufacturer from Karnataka, is set to produce chips for a variety of applications, including automotive, consumer electronics, telecom, industrial, electric vehicles, and the power sector. The company has acquired land in Sanand, Gujarat, and will soon begin construction on its new plant.

When asked about the employment potential of the new facility, Vaishnaw emphasised that, like steel, which has a multiplier effect on various industries, semiconductors are foundational for the future and will significantly boost employment across the entire economy.

Launched in December 2021, the Programme for Development of Semiconductors and Display Manufacturing Ecosystem in India focuses on making India a global semiconductor manufacturing hub with a central outlay of ₹76,000 crore.

While the first Micron semiconductor unit in the same district Sanand was approved in June 2023, by February this year, three more projects were approved, including Tata Electronics' semiconductor fabs in Dholera, Gujarat, and Morigaon, Assam, along with CG Power's unit in Sanand. These projects are expected to attract nearly ₹1.5 lakh crore in investments, with a combined capacity to produce around 7 crore chips per day and generate direct employment of 20 thousand advanced technology jobs and about 60 thousand indirect jobs.

Vaishnaw provided an update on the progress of these semiconductor projects as well, at the media briefing. The minister confirmed that Micron Technology's Sanand facility will produce India's first semiconductor chips by mid-2025. A mini version of the plant has already started manufacturing modules and circuits for the chips locally. Tata Electronics has commenced construction of its semiconductor fab in Assam, a joint venture with Taiwan's PSMC. Land acquisition, geotechnical investigations, and design work are complete, and technology agreements are in negotiation. CG Power’s Sanand plant design is finalised, with construction set to start soon, while Tata's Dholera fab project is advancing toward the construction phase.

The minister emphasised that the government is planning to take a long-term outlook for the semiconductor industry, recognising the crucial role of semiconductors in the nation's growth. The government plans to extend the Indian Semiconductor Mission (ISM) for at least the next 10 years as a robust semiconductor industry is essential for the success of large-scale electronics manufacturing and the 'Make in India' initiative.