In the ever-evolving landscape of electronic devices, the use of semiconductors is ubiquitous, especially in the automotive sector where features are continually advancing. Despite the challenges faced by the automobile sector during the COVID-19 pandemic, it has not yet fully recovered. To address the rising costs of devices, India is now venturing into semiconductor manufacturing, with plans to become a global semiconductor hub in the near future.
To achieve this ambitious goal, the Central Government has approved an estimated investment of 1.26 lakh crore rupees. Three semiconductor factories are set to be established in Gujarat and Assam under this investment.
Three New Semiconductor Factories in the Next 3 Months
The Union Minister of Communications, Ashwini Vaishnaw, has announced that the construction of these three units will commence within the next 100 days. Two factories will be located in Gujarat, while one will be set up in Assam.
Ashwini Vaishnaw revealed that Taiwan’s Power Chip Semiconductor Manufacturing Corp will collaborate with Tata Electronics Private Limited to establish a semiconductor factory in Dholera, Gujarat.
Additionally, Tata Semiconductor Assembly and Test Private Limited will invest 27,000 crores in setting up a semiconductor factory in Moriagaon, Assam.
Furthermore, CEE Power Japan’s Renesas Electronics Corporation, along with Thailand’s Stars Microelectronics, will join forces to establish a semiconductor factory in Sanand, Gujarat, with an investment of 7,600 crores.
Potential Impact on Car Prices
The move to manufacture semiconductors domestically is expected to reduce dependency on imports and subsequently lead to a decline in manufacturing costs for automobiles. With car manufacturers able to produce vehicles at lower costs, consumers are likely to benefit from more affordable car prices.
The growth of the automotive sector is closely linked to semiconductor availability. As companies can incorporate advanced features at more reasonable prices, the overall number of cars on the roads may increase.
The government’s initiative to invest in semiconductor manufacturing facilities signals a significant shift in India’s technological landscape. As the country strives to become a global semiconductor hub, the ripple effect on the automotive industry, coupled with the potential reduction in car prices, could reshape the dynamics of the Indian automobile market.