The government is shortly expected to issue a request for proposal (RFP) document requesting formal proposals from firms interested in establishing semiconductor factories. Many firms have expressed interest in establishing such fabs (fabrication units) early this year and the government is deciding on the number of subsidies after receiving detailed bids. Nearly 20 firms have expressed interest in investing in the industry.
Last time round, the government had offered a capital expenditure subsidy of up to 40% to set up fabs, but none of the approved proposals took off. The industry is expecting a better deal this time. The government reportedly has a budget allocation of USD 1 billion for a fab, which requires a total investment commitment more than USD 2 billion.