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Cabinet approves one more semiconductor unit under India Semiconductor Mission (ISM)

By99notes

(Source – https://pib.gov.in/PressReleseDetail.aspx?PRID=2050859 )

Topic: GS3 – Indian Economy, GS2 – Governance
Context
● The Union Cabinet approved Kaynes Semicon Pvt Ltd’s Rs 3,300 crore investment to set up a semiconductor unit in Sanand, Gujarat, with a capacity of 60 lakh chips per day.

● This unit is part of India’s broader semiconductor ecosystem development under the Rs 76,000 crore Program for Semiconductors and Display Manufacturing.

 Analysis of the news:

  • India Semiconductor Mission (ISM) was launched in 2021 with a financial outlay of Rs 76,000 crore under the Ministry of Electronics and IT (MeitY).
  • It aims to develop a sustainable semiconductor and display ecosystem in India by offering financial support to companies investing in these sectors.
 What are semiconductors?
  • Semiconductors are materials with electrical conductivity between that of conductors and insulators, allowing them to control the flow of current.
  • They are primarily made from silicon or germanium and are essential for modern electronics.
  • Their unique properties enable them to function as the foundation for components like transistors, diodes, and integrated circuits, which are used in devices such as smartphones, computers, and other electronic systems.
  • ISM is envisioned to be led by global experts from the semiconductor and display industries, acting as the nodal agency for scheme implementation.
  • The mission includes various schemes:
    • Scheme for setting up Semiconductor Fabs, providing fiscal support to eligible applicants to establish semiconductor wafer fabrication facilities.
    • Scheme for setting up Display Fabs to attract investments for TFT LCD and AMOLED display fabrication facilities.
    • Scheme for Compound Semiconductors, Silicon Photonics, and Sensors Fab, providing 30% fiscal support for setting up such facilities.
    • Design Linked Incentive (DLI) Scheme, offering financial incentives and infrastructure support for semiconductor design development.
  • The vision is to build a robust semiconductor and display design ecosystem, positioning India as a global hub for electronics manufacturing and design.
 Need of Promoting Semiconductor Industry
● Global Demand: Semiconductors are essential components in various industries like electronics, automotive, telecom, and healthcare, driving massive global demand.

● Strategic Importance: Semiconductors are critical for national security and technological sovereignty, as they power defense, communication, and infrastructure systems.

● Supply Chain Resilience: Establishing a domestic semiconductor industry reduces reliance on imports, mitigating risks from global supply chain disruptions.

● Economic Growth: The semiconductor industry can boost manufacturing, create jobs, and enhance India’s position in high-tech sectors, fostering economic growth.

● Technological Advancements: Semiconductors are key to innovations in AI, 5G, IoT, and advanced computing, driving the next wave of technological development.

● Global Competitiveness: Promoting the semiconductor industry helps India compete with global players, positioning the country as a hub for electronics manufacturing.

● Green Transition: Semiconductors are vital in energy-efficient technologies, aiding in the global shift toward renewable energy and electric vehicles.
Practice Question:  Discuss the strategic importance of promoting the semiconductor industry in India and its role in fostering economic growth, technological advancements, and supply chain resilience. (150 Words /10 marks)
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