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Tata Group scouts for land to set up chip assembly unit

The group has begun discussions with suppliers of semiconductor ATMP equipment and is close to deciding on the location for the unit.  (REUTERS)
The group has begun discussions with suppliers of semiconductor ATMP equipment and is close to deciding on the location for the unit. (REUTERS)

Summary

Tata Group will focus on the chip assembly and packaging unit instead of a full-fledged fabrication plant for now.

New Delhi: Tata Group is looking for land to set up a semiconductor chip assembly, testing, monitoring and packing (ATMP) unit as part of its initial efforts to develop a local manufacturing ecosystem, according to three people aware of the group’s plans.

The Tata group will focus on the ATMP unit instead of a setting up a full-fledged fabrication plant for the near term, said one of the people, seeking anonymity. “Supply chain for semiconductor chip fabrication unit is sometime away but there is a lot of interest in semiconductor packaging. It is looking for land to set up the unit," the person said.

It has formed an in-house team of 200-250 individuals to work on the project, according to the second person, seeking anonymity. Executives are exploring suitable locations in Telangana, Tamil Nadu and Karnataka, he added. “Whatever they expect from the state government, we can match up to everything, including the kind of land, water, electricity and other resources. We have been able to offer everything to them," said a senior Telangana government official. “It is also planning to set up a packaging unit in Karnataka. “It has been to several sites in three states, but a final decision is yet to be communicated," he said.

A third person said that the group has begun discussions with suppliers of semiconductor ATMP equipment, indicating that the group was close to deciding on the location.

Queries to the Tata Group did not elicit a response as of Sunday evening.

Tata Group has created a semiconductor assembly and packaging company TATA Outsourced Semiconductor Assembly and Test (OSAT), headed by Raja Manickam as the chief executive officer.

Packaging and assembly is considered as the entry point into the large scale global semiconductor fabrication ecosystem. ATMP and OSAT facilities are required for testing chips for use in electronics as well as packaging the chips, cut from wafers, which are then fitted into electronic devices such as those used in cars, TVs and various other consumer durables and industrial equipment.

The government has earmarked 76,000 crore as a financial assistance scheme to attract semiconductor fabrication and packaging units to come up in the country. The first investment under the scheme has been done by US-based Micron Technology, which has begun setting up its ATMP unit in Sanand, Gujarat. The plant will entail an investment of $2.75 billion, $800 million of which will be pumped in by Micron and the rest split between central and state governments. The first packaged chip from the unit is expected by December 2024. Tata Group would be eligible for the subsidies as well as and when they apply for it, central government officials said.

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