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7 firms for investment worth Rs 65,000 cr

IT Ministry announces that Reliance has plans to invest Rs 30,000 crore in planned units to make semiconductors and solar photovoltaic modules, reports Archana Khatri.

business Updated: Apr 03, 2008 21:36 IST
Archana Khatri

Mukesh Ambani’s Reliance Industries Ltd has jumped in with a plan to invest in semiconductors, joining six others have submitted investment proposals adding up to Rs 65,000 crore to the government. The investments would be spread over 10 years.

The Information technology Ministry announced on Thursday that Reliance has plans to invest Rs 30,000 crore out of that in planned units to make semiconductors and solar photovoltaic modules that help generate solar energy.

Six more companies including Videocon Industries, Moser Baer, Titan Energy System, KSK Energy Ventures, and California-based Signet Solar have submitted their proposals, which will be appraised by a special panel.

Any unit can claim incentives in the form of capital subsidy or equity participation. All the firms have sought subsidy from the government to set up the facilities.

Semiconductor manufacturing not only requires high level of investment, experts say, but also needs a gestation period of four to five years. “Domestic companies may not need financial help but need technical collaboration with international players”, Poornima Shenoy, President, India Semiconductor Association, told Hindustan Times.

The ministry said in a statement that the proposals cover the manufacture or assembly of a wide variety of items including polysilicon, ingots, wafers, solar cells, SPV modules, liquid crystal displays and integrate circuits (ICs), in addition to testing and packaging facilities for semiconductor devices.

Under a special incentive package scheme, the Central Government has to provide incentives amounting to 20 per cent of the capital expenditure during the first ten years for the units in special economic zones (SEZs) and 25 per cent of the capital expenditure in non-SEZ units.

In March 2007, Infineon and Hindustan Semiconductor Manufacturing Corporation had announced a tie-up to set up two semiconductor facilities, but the proposal has not taken off so far.