Union Cabinet Approves Jewar Semiconductor Manufacturing Unit

Union Cabinet has given its approval for the proposed semiconductor manufacturing unit in Jewar in Uttar Pradesh. The facility is being set up as a Rs 3,706 crore joint venture between HCL and Foxconn. Display driver chips for automobiles, laptops, mobile phones etc. will be manufactured in this unit.

Union IT Minister Ashwini Vaishnav, while announcing the decision said, “Once the display driver gets properly done here, display panel manufacturing will also come to India. This will also meet Foxconn’s requirement for rest of the world.”

Demand For Chips To Go Up Significantly

Foxconn is a Taiwanese manufacturer of electronics such as semiconductor chips. It does contract manufacturing for companies such as Apple. Display driver chips are integrated circuits that are embedded in LCD panels. These chips are responsible for the operations of LCD screens such as those of mobile phones.

Chips or semiconductors are the basis of operations of electronic products such as smartphones. Demand for chips is expected to go up further as the use of Artificial Intelligence (AI) increases. According to data from Deloitte Centre of Technology, global sales of semiconductor chips in 2024 stood at $627 billion. This is expected to rise to $697 billion in 2025.

Data source: Deloitte Centre of Technology

Foxconn has a number of manufacturing plants in China. Foxconn, like many other companies, is looking to reduce its reliance on China by pursuing China +1 strategy.

The Jewar plant, for which the approval has been given, is expected to produce 20,000 units of wafers per month and 36 million units of chips monthly. Wafers are the base on which chips or integrated circuits are designed. Five semiconductor manufacturing units are already under construction in India.

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Source: https://www2.deloitte.com/us/en/insights/industry/technology/technology-media-telecom-outlooks/semiconductor-industry-outlook.html