Aiming to make India self-reliant in chips, the government is looking to expand the semiconductor design-linked incentive (DLI) scheme to bigger companies and not restrict it only to startups, Rajeev Chandrasekhar, minister of state for IT and electronics, said on Saturday.
“We are envisaging that if there is a big Indian or big foreign company that wants to do chip design in India, we should allow the future design scheme to support them too,” the minister said on the sidelines of the SemiconIndia 2023 conference. “Expected outcome of the future design DLI is that we have more indigenously designed chips, especially in AI, in new cutting-edge areas, data centres and so on,” Chandrasekhar said, adding that there is no reason not to support chip design proposals such as next AI accelerator chip, IoT chip, etc, of big companies.
Separately, since the Micron investment announcement for assembly and packaging unit in the country, the government has received at least four-five assembly, testing, marking, and packaging (ATMP) projects from companies, compound semiconductor proposals, as well as from companies in the memory business, the minister said.
The semiconductor DLI scheme is part of the government’s Rs 76,000-crore semiconductor incentive scheme. The government has kept aside Rs 1,000 crore for the DLI scheme.
As part of the scheme, the government will reimburse 50% of the design-related expenditure incurred by startups with a ceiling of Rs 15 crore. Besides, the government will also provide deployment-linked incentives of 4-6% of net sales turnover over five years subject to a ceiling of Rs 30 crore per application. The incentives will be provided to approved applicants whose semiconductor design for integrated circuits (ICs), chipsets, system on chips (SoCs), systems & IP cores and semiconductor-linked design are deployed in electronic products.
“Instead of saying that the DLI scheme is only for startups, we will say anybody who has a chip design can apply as long as it is an original chip that is going to go into an application, and the intellectual property (IP) is Indian. We will look at supporting them financially,” Chandrasekhar said.
When asked about specific incentives for ancillary companies whose products will be used by semiconductor scheme beneficiaries for making or assembling chips, Chandrasekhar said the government will not provide incentives for ancillary companies. However, the state governments can do that if they want, adding that for supply chain and ancillary companies, state governments can give land, water and electricity to attract them.
On India’s partnership with Taiwan for the semiconductor ecosystem, Chandrasekhar said India is exploring skilling and technology and capability tie-ups. “A partnership with Taiwanese companies is very much on the cards,” he added.
With regard to skilling and talent for semiconductors, the government has rolled out a curriculum being implemented by 300 colleges and universities. “We are going to create a framework that will allow students to intern in a regular fab, which means there will be a fab partner for this curriculum,” he said.