The government has cancelled the letter of intent granted to a consortium led by HSMC Technologies India for setting up the country's first electronic chip manufacturing plant, Parliament was informed Wednesday.
"The government, on the recommendation of the empowered committee (EC) constituted for the purpose of setting up of Semiconductor Wafer Fabrication (FAB) manufacturing facilities in the country, cancelled the LoI issued to the consortium led by M/s HSMC Technologies India Pvt Ltd on April 20, 2018," Minister of State for Electronics and Information Technology S S Ahluwalia said in Lok Sabha.
He said the consortium could not submit the requisite documents as per the LoI, despite being provided extension of time on multiple occasions.
This consortium intended to set up the semiconductor wafer fabrication facility in Gujarat, while another consortium led by Jaiprakash Associates Ltd had proposed to establish the plant in Uttar Pradesh.
"As per the LoI, both the consortia were required to submit the documents for demonstration of commitment. The consortium led by M/s. Jaiprakash Associates Ltd withdrew the proposal," Ahluwalia said.
Both the plants were to be set up with an investment of around Rs 63,000 crore.
"The Government of Gujarat has informed that it is willing to support any investor intending to set up chip fabrication facility. However, considering the investment required and technology-intensive nature of the industry, the Government of Gujarat does not intend to do it by itself," Ahluwalia said.
He said the Centre has approved incentives for a project of Mundra Solar PV Ltd to set up a 1.2-gigawatt solar photovoltaic modules manufacturing facility at Adani Ports Special Economic Zone in Gujarat with a proposed investment of Rs 4,837 crore in three phases.
In response to a separate question, Ahluwalia said electronics hardware production in the country has increased from Rs 1,90,366 crore in 2014-15 to Rs 3,87,525 crore in 2017-18, registering a compound annual growth rate of 26.7 per cent.
The minister said that the government is also working on a national policy on electronics to promote domestic manufacturing and export of the electronics sector to achieve a turnover of USD 400 billion by 2025.
"This will include targeted production of 1 billion mobile handsets by 2025, valued at USD 190 billion (approximately Rs 13 lakh crore), including 600 million mobile handsets valued at USD 110 billion (about Rs 7 lakh crore) for export," Ahluwalia said.
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