Couple of days back Intel announced that it would build its next FAB (Fabrication factory where our silicon chips are made) in China. India lost out.
For many years there has been a tussle between Intel and the Indian government over this FAB. It is a $2.5 billion investment and there was no doubt that the Indian government wanted to get this FAB but at the same time the IT ministers were not ready to make enough concessions to convince Intel to get them to build the FAB in India. Apart from the tax exemptions and such, Intel was also worried about things like the bribes you have to pay at transportation check points plus the red tape at our ports and customs. In the 2007 budget some new incentives were introduced to attract the semiconductor manufacturing industry but looks like those weren't enough…
Semiconductor manufacturing given the scale of these FABs and the size of the industry itself can hugely impact an economy. It has the ability to bring in huge amounts of foreign investment and generate employment. These FABs run round the clock and bring in good technology because they are extremely high tech, all good benefits for any economy. If India had bagged Intel's FAB then given that Intel is the leader in semiconductor manufacturing it would have been a huge green signal to the rest of the players to view India as a viable destination...
Oh well I am sure there are other fish left to fry...
Intel Makes $2.5 Billion Bet On China
2 comments:
India did announce its semiconductor policy about a month back but i guess it was too late for Intel .. and one more hypothesis i heard (although i dont understand their point) is that these semiconductor fabs as such are not very profitable for the govt to give huge subsidies but a glance at it tells me that it can certainly create huge employment opportunities to young india!
Ya even I don't buy the reasoning that semiconductor manufacturing is not that profitable after putting in the huge subsidies...
Post a Comment