Tower Semiconductor proposes $8 billion fab in India

Kaynes SemiCon recently partnered with Taiwan’s Aptos Technology for semiconductor packaging and testing training and technology licensing. In parallel, CG Power and Industrial Solutions launched a joint venture with Renesas Electronics America and Stars Microelectronics (Thailand). In January, Foxconn and HCL announced a collaboration plan to establish an OSAT facility in India.

“The arrival of Tower Semiconductor is particularly exciting, even more so than Micron’s announcement,” said Pareekh Jain, CEO of EIIRTrend & Pareekh Consulting. “While Micron’s investment focused on packaging, testing, and assembly, Tower’s proposal to establish a fabrication plant is a significant development. Fabrication facilities are more complex and serve as a strong testament to the global confidence in India’s capabilities.”

Tower’s repeated attempt

Tower Semiconductor’s proposal to establish a silicon chip fabrication plant represents a significant advancement in value addition within the semiconductor industry. Notably, Tower had previously expressed interest in setting up manufacturing operations in India nearly a decade ago but was unable to successfully enter the market at that time.

A more recent attempt with the chip consortium ISMC also failed to materialize.

“Tower has been interested in helping with opening commercial silicon fab in India at least since 2012,” said Arun Mampazhy, an independent analyst. “However, multiple efforts failed – the reasons varied as lack of coherent policy and process from the government, Indian partners that suffered financial issues and credibility, or both. We have yet to see the official details of the latest application. However, it is important that the government proactively facilitates it.” 

Although confidence in India from global players has noticeably grown over the past five years, the outcome of the current proposal also remains uncertain. This caution stems from past experiences where announced fabrication projects by companies such as Vedanta and Foxconn were prematurely terminated before any progress was made.