Tower Semiconductor awaits approval for wafer fab proposal following Indian general elections

Jingyue Hsiao, DIGITIMES Asia, Taipei 0

Credit: AFP

After India approved three chipmaking proposals earlier this year, Tower Semiconductor's wafer fab proposal is in the spotlight as India's general elections conclude.

Except for Micron and Tata-PSMC's wafer fab proposals, no other major global semiconductor manufacturers, such as Intel, TSMC, Samsung Electronics, UMC, and GlobalFoundries, have shown interest in India's Semiconductor Mission.

Business Today, citing an unnamed source, reported that there are 6-7 proposals awaiting approval, but many lack the required technology partners. The government has an agreement with Belgium's Interuniversity Microelectronics Centre (IMEC) for technology to manufacture chips at 28nm and above, but IMEC is not considered a partner for full-scale production.

Meanwhile, after Tower Semiconductor and ISMC's wafer fab project fell apart, Tower Semiconductor sent a separate US$8 billion proposal to set up a project in March and has been waiting for approval from the India Semiconductor Mission and Ministry of Electronics and IT.

However, multiple obstacles emerged as to Tower Semiconductor's proposal. First, in March, ISMC, a joint venture formed by Next Orbit Ventures and Tower Semiconductor, asked the Indian government not to approve Tower Semiconductor's proposal, as ISMC argued Tower Semiconductor's unilateral decision to halt their partnership was a breach of contract.

Furthermore, the Economic Times reported in late May that unnamed Indian government officials requested Tower Semiconductor to revise its proposal. India is seeking a technology partner with more advanced manufacturing capabilities, as it is not satisfied with Tower Semiconductor's plan to include 180nm technology node in its Indian wafer fab proposal. The officials asked the company to include partners for the 28nm, 40nm, 55nm, and 65nm nodes instead. Another source indicated that global demand for 180nm and above analog nodes is declining.

Tower Semiconductor specializes in analog and mixed-signal chips, which do not require technologies as advanced as 28nm and below. Business Today quoted Satya Gupta, President of the VLSI Society, saying that these chips are suitable for applications in automobiles, defense, aerospace, medical electronics, sensors, power management, and high-speed uses. He notes that 65nm technology will make up about 7% of the $100 billion overall foundry market by 2025.

Danish Faruqui, CEO of Fab Economics, states that it would be a significant achievement for India if Tower Semiconductor adopts 65nm technology, as it involves advanced DUV lithography, unlike the older 90nm technology. This upgrade would enable faster and more cost-effective transitions to future technologies at the India Fab site as market demands evolve.