A boost to India’s semiconductor manufacturing capability is through the approval of more than Rs 8,500 crore incentive package by the Uttar Pradesh government for two large semiconductor projects. These projects have located near Noida International Airport and situated on Yamuna Expressway with an ambitious plan formulated by UP for Semiconductor Policy 2024 when passed by Centre Govt. By doing all these and more, being made a high-tech semiconductor producing regions, the development shall gain momentum as the region promises a thousand pieces of jobs under such initiatives.
Projects Around Noida International Airport:
The two flagship ventures are headed by Tarq Semiconductors, part of the Hiranandani Group, and Vama Sundari Investments, a joint venture between the HCL Group and Foxconn Hon Hai Technology India Megadevelopment. The three companies will invest more than Rs 32,146 crore in the Yamuna Expressway Industrial Development Area (YEIDA).
1. Investment by Tarq Semiconductors
It would be a significant investment of Rs 28,440 crore by Tarq Semiconductors in the state, which is planned to be built on 125 acres of land in Sector 28. In this place, the idea is to carry out the manufacturing of compound semiconductors, such as gallium nitride, silicon carbide, and gallium arsenide besides devices and optoelectronic parts in silicon photonics.
Such a project can be creating direct or indirect jobs around 11,000 while subsequently increasing employment greatly in the vicinity.
2. Vama Sundari Investments Semiconductor Plant
The second project taken by Vama Sundari Investments is to be a semiconductor part assembling and making one. Its investment is approximately Rs 3,706-crore-sized and is placed on 50 acres in the Sector 10 area. So, it may create employment scopes for as much as 3,780 people also, and ultimately support the rapid development of India’s overall ecosystem for semiconductors in every way possible. This attained in-principle allotment clearance for land allotment by YEIDA this year also.
Key Incentives and Government Support
To make these projects successful, the UP government has declared a series of attractive incentives under its Semiconductor Policy 2024. Some of the key incentives are as follows:
- Capital Subsidies: Tarq Semiconductors will be given a capital subsidy of Rs 7,037.50 crore, and Vama Sundari Investments will be given a subsidy of Rs 919.3 crore.
- Land Rebate: The cost for lands from both the companies would bring in a tremendous cut. Tarq would benefit by availing abatement of 75 percent on land costs which come to be approximaely Rs 320.9 crores. And Vama Sundari Investments will have an abatement of around Rs 124.4 crores.
- Stamp Duty Exemption: Tarq and Vama Sundari Investments are completely exempted from stamp duty and registration fees. This saves Rs 29.9 crore for Tarq and Rs 1.1 crore for Vama Sundari Investments.
- Electricity Duty Exemption: Electricity duties have been exempted for the next 10 years, and dual power grid support will be there to provide continuous power supply for both the companies.
- Water and Power Consumption Subsidies: Subventions for waters and power would be provided through the government with the facilities concerned to cut consumption costs.
With these fiscal stimuli, the state government of Uttar Pradesh has been committed to sponsoring upskilling of local residents, subventions for innovation purposes, and further employee welfare-related initiatives. So, this implies that the State will have employees who are specifically trained for what the semiconductor field demands.
Non Disturbance clause in the lease for long term investment
The UP government has agreed to keep the non-disturbance clause, which would guard the interest of the semiconductor companies, within the lease agreement that would be the incentive towards making long-term investments.
After a certificate from the YEIDA about the completion of investments by these companies, such companies will then be given certificates indicating their commitment towards the region. Lease agreements will be canceled based on violations. However, any such decisions made will not happen unilaterally without the board of directors permission from YEIDA.
Impact on Employment and Local Economy
These semiconductor manufacturing factories will place UP as a central player in India’s semiconductor value chain and thereby also give it a much-needed boost to its regional economy.
The 11,000 employment opportunities created in Tarq Semiconductors and the indirect employment of another 3,780 jobs provided by Vama Sundari investments will add towards the employment markets directly and indirectly. Increased local economic activity by the region is bound to further benefit local industries and suppliers of the semiconductor-related industry, ensuring a sustainable surrounding ecosystem.
Conclusion
UP government has cleared Rs 8,500 crores in incentives for semiconductor projects close to the Noida International Airport.
It is one of the most important steps towards making India a global leader in producing semiconductors. These projects will open jobs for thousands, engender technological innovation, and catapult India to the leadership of the global semiconductor supply chain. The successful implementation of these initiatives will surely have a long-lasting impact on the region as well as the economy of this country when the central government reviews these proposals, given the investments over Rs 32,000 crore combined.
Refer:
TOI, Link to article
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