The Hindu Business Line : `Semiconductor policy likely before Budget'

Booster pack
Cash incentive or direct subsidy to a limit.
Minimum threshold investment to qualify
Sops will be over and above those of SEZs and other sops offered by the Centre and States.

Advertisement

Hyderabad Feb. 6 A semiconductor-cum-electronics policy is likely to be announced before the Budget.

The policy, which has been accorded an in-principle nod by the Union Cabinet, is being fine-tuned by a Group of Ministers drawn from IT and Finance and also the Planning Commission, according to Mr Prithviraj Chavan, Minister of State in the Prime Minister's Office.

Speaking at the Vision Summit, after unveiling a report of the Indian Semiconductor Association (ISA) and Ernst and Young India, Mr Chavan said that the fabless semiconductor industry in the country has made amazing strides but this could not have been done without the growth of related sectors including electronics industry.

The proposed package is aimed at covering semiconductors, LCDs, plasma panels, solar and photovoltaic cells, advanced micro and nano devices and assembly and testing operations in the semiconductor industry.

Providing some insights into the policy, the Minister said that the package would have cash incentive or direct subsidy up to a limit and have a cut-off date for seeking permission. Apart from defining a minimum threshold investment to qualify, the incentives would be over and above those of special economic zones and other sops offered by the Central and State Governments.

The Government has decided to be proactive and complete the chain of the semiconductor industry right from design to manufacture by encouraging manufacturing.

Revamping lab

Mr Chavan said that the government was in the process of revamping the Government-owned Semiconductor Complex Ltd in Chandigarh. The complex has been converted into a `society' and will function as a national laboratory for use by the semiconductor industry.

Further, the lab is being upgraded to handle modern semiconductors, he said.

Moreover, in order that there is a steady stream of technical talent for absorption by the industry, the government is considering allowing foreign direct investment in higher education, Mr Chavan said.

Manufacturing sector

Given the promise the manufacturing sector holds in the country, the PMO has set up three high-powered committees, each of them chaired by the Prime Minister himself, to see how this can grow faster, he said. These committees are for infrastructure, energy and international trade integration.