Micron to roll out first India-made chips by early 2025—for global markets

Micron is in discussions with vendors to bring semiconductor supply chain to India, with one of its key suppliers Simmtech, which makes substrates, beginning its set up in the same location.  (REUTERS)
Micron is in discussions with vendors to bring semiconductor supply chain to India, with one of its key suppliers Simmtech, which makes substrates, beginning its set up in the same location. (REUTERS)

Summary

  • Micron is setting up India’s first assembly, testing, monitoring and packaging plant, which will be the first leg of its India plan over the next decade. The 1.4 million sq ft unit is coming up in Sanand, Gujarat.

The first semiconductor chips to be made in India will roll out from US-based Micron Technology Inc.'s unit at Sanand in Gujarat in the first half of 2025, but a majority of these will be exported from the first day itself.  

“We expect to have products rollout early next year, in the first half, which is a very good turnaround given that we had announced this whole engagement in the middle of last year," said Micron India's managing director Anand Ramamoorthy in an interaction with Mint

“No factory in India will ever be building for India only. It will be a small part, and bulk of it will be for exports, and that's actually a good thing because we want our factories to be globally viable," he added.

Also Read: Micron’s investment will boost India’s tech chops and spur economic growth

India wants to create its own semiconductor manufacturing and chip ecosystem so as to reduce dependency on imports of the critical component used across industries including defence, automobiles, and telecommunications and in everyday devices such as smartphones and laptops. Micron was the first semiconductor chip assembly plant approved by the Indian government. 

Ramamoorthy said the semiconductor chips from Micron's Sanand unit could be used in several sectors, including data centers, smartphones, notebooks and internet of things, or IoT, but the allocation would be decided closer to final production.

“We want to serve all customers. How we route those bits into different verticals will be based on various factors like turnaround time, pricing dynamics, customer needs, their inventory position, so we have to be agile. Overtime, all the verticals that will be serviced (from here)," he said.

Micron could also look at new opportunities in two-wheeler electric vehicles and government contracts that are unique to the Indian market, he added. 

On the possibility of working with Tata Electronics Ltd’s semiconductor fabrication units coming up in Assam and Gujarat, Ramamoorthy said some partnerships could emerge with Tata Group companies since they were already customers.

“We (have) worked with the Tata Group companies, many of them are customers, which we will continue to, and at the right time we might even explore if there is something more we can do in terms of taking our product lines into their factories, but that's too early and not discussed yet," Ramamoorthy said.

He added that Micron was in discussions with vendors to bring semiconductor supply chains to India, with one of its key suppliers Simmtech, a South Korean firm, beginning to set up its unit in the same location as Micron in India. 

Ramamoorthy said Micron's suppliers will come to India and the strategic ones may be co-located in Gujarat. 

“Now they’re seeing that there are more announcements coming in the state of Gujarat, they realize that there are more opportunities for all of them. We will provide all the fair chances and recommendation but they will work with the government on what kind of support and incentive they can get. Our job is to certainly showcase our supplier vendor network or engineering footprint," he said.

Ramamoorthy also noted that the vendors would not be solely supplying to Micron in India but to locations across the world where Micron plants are situated. The chipmaker has seven sites globally, including at China, the US, Japan, Singapore, Malaysia, and Taiwan, where it manufactures memory storage chips.

Micron is the first company to set up its assembly plants in India under the Union government’s $10-billion financial incentive scheme for establishing semiconductor fabrication and assembly units in the country.

Apart from Micron, other companies are also on their way to establishing chip fabrication and assembly units in India. 

Tata Electronics Ltd will set up a semiconductor fabrication unit that will be India’s first such, and an indigenous one, in Gujarat, and an assembly unit in Assam with a combined investment of 1.26 trillion. And the Murugappa Group’s CG Power and Industrial Solutions will set up an assembly and testing unit with a 7,600 crore investment. 

The government is evaluating several other proposals, including a $10 billion proposal from Israel’s Tower Semiconductor.

Micron's 1.4 million sq.ft. unit coming up at Sanand will be under the first leg of its India plan for the next decade. 

Mint had reported earlier that the chipmaker will set up four to five such plants including fabs in India over the coming years.

The Union and Gujarat governments are allocating $1.95 billion in financial support for Micron's new plant, while the rest of the investment of $825 million will be borne by the company.

Ramamoorthy said Micron will generate 5,000 direct and 15,000 indirect jobs over the next four to five years. The company already has just over 4,000 people working in its Hyderabad and Bengaluru centers, where most of its research and development takes place.

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