New Delhi: The Gujarat government signed a Memorandum of Understanding (MoU) with the US-based computer storage chip maker Micron on Wednesday in a bid to set up a USD 2.75 billion semiconductor assembly and test facility at Sanand in Ahmedabad district. This will be the first semiconductor manufacturing facility in India, said Union Electronics and Information Technology Minister Ashwini Vaishnaw. He further said that the first chips will be manufactured within 18 months.

Taking to Twitter, the Union minister said, “Historic day for India… Thanks to PM Narendra Modi’s comprehensive semiconductor mission.”

Historic day for India…
Thanks to PM @narendramodi Ji’s comprehensive semiconductor mission.

MoU signed between Micron and Govt of Gujarat. pic.twitter.com/fF7zVuwAp5

— Ashwini Vaishnaw (@AshwiniVaishnaw) June 28, 2023

The Memorandum of Understanding was signed in Gandhinagar by Micron’s senior vice president Gurusharan Singh and the Gujarat government’s secretary, Science and Technology Vijay Nehra in the presence of Chief Minister Bhupendra Patel and Ashwini Vaishnaw.

“There were attempts to bring semiconductor manufacturing facility to India for long. Now it will be a reality,” he said.

For the last several decades, India has been dependent on imports of semiconductor chips, and the demand for them will increase as the country’s manufacturing sector grows, Vaishnaw said.

“Generally, it takes 36 to 48 months for a semiconductor chips facility to start manufacturing. In India, the first chips are likely to be manufactured in 18 months,” Vaishnaw said. More companies are in the pipeline to set up semiconductor plants in India, he added.

Notably, the deal was finalised during Prime Minister Narendra Modi’s recent State visit to the United States, and within six days the Gujarat government allocated land and signed the deal, the minister said.

Micron senior vice president Gurusharan Singh said that they decided to set up the plant in Gujarat due to its industry-friendly policies.

At Sanand plant, “(silicon) wafers will be converted into semiconductor chips”, Singh said, adding that it will generate 5,000 direct jobs and 15,000 indirect jobs. The plant will entail a total investment of USD 2.75 billion (around Rs 22,540 crore), Singh said.