According to a highly placed source in the ministry, Intel was never interested in setting up a chip-manufacturing unit in India; instead, it wanted to establish a $250-300 million assembly-test-mark-package plant (ATMP). The talks, however, fell through because the government did not agree to Intel's demand for a higher subsidy.
They were not really looking at a fab. All they wanted was an ATMP and had asked for a $50-million cash subsidy upfront. But their demand was turned down In fact, the kind of package that Intel was offered at that point of time was better than the subsidy given in the semiconductor policy (20%) announced this year, the source added.
An Intel spokesperson, when contacted, said, Our discussions with the Indian government had been regarding the Assembly Test Manufacturing Plant. We have shared our perspective many a time and have nothing more to add to it.
Barrett, during his ninth visit to India last week, had said a delay in the announcement of semiconductor policy on the part of Indian government had led Intel to turn its back to the country and set up semiconductor manufacturing units in China and Vietnam. We were in serious discussions for chip manufacturing in India but the government was a bit slow in coming out with its semiconductor proposal and missed the window, Barrett said. He, however, added that Intel might base one of its facilities in India, as the country was high on its list for future opportunities, if additional capacity was required.