Down But Not Out: On the Indian Government’s Semiconductor Fab Ambition
The QuintThe semiconductor chip fabrication in India programme, though, is unlikely to secure any of these three advantages. The Semiconductor programme did not ask for, and no bidder promised, that the semiconductor chips would be sold in India to the Indian electronics products manufacturers at prices lower price than global prices despite 50 percent to 70 percent fiscal support. The fact that two bidders in the earlier round proposed to export almost the entire semiconductor chips produced also negated the possibility of Indian electronic manufacturers getting the chips produced in India at lower than prevailing prices. In the circumstances, it is worth considering seriously whether there is any real economic advantage for India in investing so much public money and making so much effort in establishing semiconductor fabs. On the contrary, the US, China, Japan and many other countries are pumping in so much in semiconductor subsidies that it is quite likely that there would be a glut of semiconductor chips in times to come, which will make these chips relatively quite cheap to buy and to build products and services thereon.