The process to modernise Semi-Conductor Laboratory (SCL), country’s first chip fabrication unit, has finally started. The company has invited bids to improve the existing 180 nanometre (nm) fabrication line at an estimated cost of around Rs 4,000 crore, officials said. The augmentation and enhancement of the existing 8 inch fab, which uses 180 nm technology node, involves replacement of decades-old equipment.
The focus of the upgradation is also to increase the current production line capacity to 1500 WSPM (wafer starts per month) from about 700 WSPM, which SCL does presently, according to officials. Wafers per month is a metric used to measure the throughput or production rate of semiconductor manufacturing.
Currently, SCL is spending close to Rs 127 crore annually on repair and maintenance of equipment. A higher repair expense can be attributed to refurbishing old equipment. Therefore, new equipments are needed to reduce project delivery time, officials said.
SCL would also need modifications at its cleanroom and utility connections to meet the requirements for commissioning of supplied and upgraded tools, according to the tender document. Cleanrooms are essential for the manufacturing of semiconductors.
Notably, the move will pave the way for global companies like Applied Materials, Cadence, Synopsys, KLA, among others, which are suppliers of semiconductor tools and machinery.
SCL is following a two-stage bid process for upgradation, which involves three bid packages. In the first stage, it is inviting only technical bids and then commercial bids in the next stage.
Bid submission end date is April 1. Once the bidders get qualified technically, then they will be asked to submit financial bids.Officials said SCL upgradation is a complex process and actual implementation will be done somewhere in June after finalising the bidders.
According to the tender document, the scope of work is divided into three bid packages. The first package involves gap analysis and detailed study to determine precise requirements for augmentation including the cleanroom and utilities sources. It also involves a comprehensive annual maintenance contract for 5 years, which can be extended up to 3 more years, for existing equipment and supplied equipment and upgrades post-warranty.
The second package includes supply and qualification of three technology intellectual properties (IPs) such as Radio frequency CMOS, and design enablement on the existing SCL process for 8-inch line as part of technology transfer. The third package includes supply and implementation of manufacturing execution system (MES) along with equipment automation. Bidders can bid for one or more packages based on the eligibility criteria.
As per the eligibility conditions, bidders can be a single entity or they can bid under a consortium, for which the members cannot exceed three. The bidders should have an average annual turnover of at least Rs 1,000 crore during the last three audited financial years. The earnest money deposit for bid package 1 is Rs 25 crore, for bid package 2 is Rs 5 crore, and for bid package 3 is Rs 50 lakhs.
Further, the bidders should have successfully completed at least one similar contract in the 15 years preceding the bid due date, the tender document said.
An upgrade of the existing fab assumes significance as SCL is now venturing beyond the strategic sectors and opening up its fab line for design startups for limited chip production. Officials said there is also a need to reduce the project delivery time or cycle time for chip manufacturing in its facility.
Simultaneously, the plan to upgrade SCL’s chip technology to higher nodes such as 65 nm, 40 nm and 28 nm is in the works, officials added. The Rs 4,000-crore estimated cost for the current augmentation is part of the Rs 76,000-crore semiconductor incentive scheme. Earlier, the government had announced $1 billion for SCL’s modernisation. However, the outlay is expected to go up looking at the government’s plan to make it on par with global standards, to support startups and industry for R&D and prototyping, as well as increase its capacity.
A fresh outlay for the semiconductor mission 2.0 is also being considered at the moment. For modernisation of SCL, the government has set aside Rs 400 crore for FY26. Around Rs 900 crore was allocated for SCL modernisation in FY25. However, the actual spending was Rs 11 crore.