Israel-based Tower Semiconductor revives plans for Indian Chip Plant

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Israel-based Tower Semiconductor revives plans for Indian Chip Plant

Israel-based Tower Semiconductor revives plans for Indian Chip Plant

Industry News
Oct 23,23

This development follows Intel's cancellation of its $5.4 billion acquisition plan for Tower Semiconductor in August due to regulatory challenges.

Israel-based Tower Semiconductor revives plans for Indian Chip Plant

Israel-based chip manufacturing firm, Tower Semiconductor, has expressed renewed interest in India's chip incentive scheme and is contemplating the establishment of a semiconductor fabrication plant in the country, according to sources. This development follows Intel's cancellation of its $5.4 billion acquisition plan for Tower Semiconductor in August due to regulatory challenges.

If Tower Semiconductor's proposal materialises, it would mark the first instance of a semiconductor company with substantial fabrication expertise applying for India's $10 billion chip manufacturing initiative. This move could significantly bolster New Delhi's ambitions in the chipmaking sector.

In response to queries about Tower Semiconductor's revived interest, Rajeev Chandrasekhar, the Minister of State for Electronics and IT, revealed that the government has invited the company's CEO, Russel C Ellwanger, for discussions on potential collaboration in the chip domain. Chandrasekhar, who met with Ellwanger along with Israel's Ambassador to India, Naor Gilon, refrained from commenting on whether the company would apply under the chip manufacturing scheme.

Tower Semiconductor, renowned for its older technology specialising in analog chips used for tasks like signal amplification and power management in cell phones and other devices, had put its investment plans in India on hold during the pending merger. However, with the acquisition falling through, the company has reignited its interest in the chip incentive scheme, as stated by an anonymous senior government official.

Despite successfully attracting major players such as Micron Technology to establish a chip packaging plant in India, the country has yet to receive a viable application for a fabrication plant. While securing Micron's $825 million investment commitment for the packaging plant marked a significant achievement for India's chip ambitions, having a chip foundry would represent a substantial milestone and attract further investments in the sector.

The International consortium ISMC, supported by Abu Dhabi-based Next Orbit and Tower Semiconductor, had previously withdrawn its proposal due to the pending merger. Initially, the consortium had planned to establish a $3 billion semiconductor fab in Karnataka. The current situation between Israel and Palestine adds an additional layer of consideration for Tower Semiconductor in navigating its investment plans in India.

Source: Indian Express