Rajasthan Gets Its First Semiconductor Plant
Summary
Rajasthan entered India’s strategic semiconductor sector with the inauguration of its first Semiconductor ATMP/OSAT facility at Bhiwadi, set up by Sahasra Semiconductors Pvt. Ltd. within the Electronics Manufacturing Cluster (EMC) at Salarpur, Khushkhera.
This is India’s first SME-led ATMP/OSAT (Assembly, Testing, Marking and Packaging / Outsourced Semiconductor Assembly and Test) facility, with an investment of over ₹150 crore under the SPECS scheme. The plant currently has a capacity of 60 million packaged units annually, scalable to 400–600 million units in 2–3 years, focused on Micro SD cards, flash storage, LED driver ICs, eSIMs, and RFID products.
The project is a key element of India’s broader push under the India Semiconductor Mission (ISM), Make in India, and Atmanirbhar Bharat, aimed at reducing the country’s heavy import dependence on strategic electronic components.
Background & Concept
What is a Semiconductor?
A semiconductor is a material (typically silicon) with electrical conductivity between that of a conductor and an insulator. Semiconductors are the building blocks of modern electronics — found in everything from smartphones, computers, EVs, satellites, medical devices, missiles, and AI servers.
The Semiconductor Value Chain
The semiconductor industry has four broad stages:
| Stage | Description | Example Players |
|---|---|---|
| 1. Design (EDA + IP) | Chip designing using Electronic Design Automation tools | Qualcomm, Apple, Nvidia, Indian startups (Saankhya Labs) |
| 2. Fabrication (FAB) | Manufacturing the silicon wafer with circuits etched on it | TSMC, Samsung, Intel; Tata–PSMC Dholera (India) under construction |
| 3. ATMP / OSAT (Assembly, Testing, Marking, Packaging) | Cutting wafers into chips, packaging, testing | ASE (Taiwan), Amkor; Sahasra, Bhiwadi is India’s first SME-led ATMP/OSAT |
| 4. End Product Integration | Embedding chips into devices | Apple, Foxconn, Samsung |
ATMP/OSAT is often called the “back-end” of the chip industry — less capital-intensive than FAB but strategically vital, and a feasible entry point for emerging economies like India.
About the India Semiconductor Mission (ISM)
- Launched: December 2021.
- Outlay: ~₹76,000 crore.
- Nodal Agency: India Semiconductor Mission (ISM), set up as an Independent Business Division within Digital India Corporation under MeitY.
- Objective: Build a sustainable semiconductor and display ecosystem in India.
Schemes under ISM:
- Scheme for Semiconductor Fabs
- Scheme for Display Fabs
- Scheme for Compound Semiconductors / Silicon Photonics / Sensors / ATMP/OSAT
- Design Linked Incentive (DLI) Scheme
About the SPECS Scheme
Scheme for Promotion of Manufacturing of Electronic Components and Semiconductors (SPECS) — launched in April 2020 by MeitY with an outlay of ₹3,285 crore, providing a 25% capital subsidy for investment in identified electronic components and semiconductors. SPECS supports plants like Sahasra at Bhiwadi.
About the EMC Scheme
Electronics Manufacturing Clusters (EMC) Scheme — launched in 2012, revamped as EMC 2.0 in 2020 — provides financial assistance for the creation of world-class infrastructure for electronics manufacturing clusters. The Salarpur–Khushkhera EMC in Rajasthan is one of the beneficiaries.
Key Features of the Bhiwadi Plant
- Type: ATMP/OSAT facility (semiconductor packaging, testing, marking).
- First of its Kind: India’s first SME-led semiconductor ATMP/OSAT plant.
- Promoter: Sahasra Semiconductors Pvt. Ltd.
- Location: Bhiwadi (Rajasthan), near Delhi-NCR — within the EMC at Salarpur, Khushkhera.
- Investment: Over ₹150 crore, supported under SPECS.
- Cleanroom Standards: Class 10K and 100K cleanrooms (highly controlled, dust-free).
- Products Packaged: Micro SD cards, flash storage devices, LED driver ICs, eSIMs, RFID products.
- Production Capacity: Currently 60 million units/year, scalable to 400–600 million units in 2–3 years.
- Anchor Schemes: ISM, SPECS, EMC 2.0, Make in India, Atmanirbhar Bharat.
India’s Semiconductor Story
India’s semiconductor ambitions have accelerated dramatically since 2021:
- India Semiconductor Mission (ISM), 2021 — ₹76,000 crore outlay.
- Tata–PSMC FAB at Dholera, Gujarat (under construction; India’s first commercial fab).
- Tata OSAT at Morigaon, Assam (under construction).
- Micron Technology ATMP at Sanand, Gujarat (announced 2023, under construction).
- CG Power–Renesas OSAT at Sanand.
- Kaynes Semicon at Sanand.
- L&T Semiconductors (fabless).
- Tata Electronics entering full-stack semiconductor business.
India’s first commercial semiconductor chip is expected to roll out from Dholera/Sanand around 2026–27.
Challenges
- High Capital Intensity: Even ATMP/OSAT requires significant capital; front-end fabs require $10–20 billion each — high entry barrier.
- Skilled Workforce Gap: Estimated requirement of 1 million semiconductor professionals by 2030 vs current trained pool of <100,000.
- Limited Eco-System Depth: Weak presence of ancillary industries — chemicals, gases, photomasks, lithography equipment.
- Import Dependence on Wafers & Equipment: Bulk of raw silicon wafers, EUV/DUV lithography machines, and high-end materials still imported.
- Geopolitical Risks: Dependence on TSMC (Taiwan), ASML (Netherlands) in a contested Indo-Pacific environment.
- R&D Spend: India’s R&D spend is ~0.7% of GDP, well below the 2–3% needed for cutting-edge semiconductor design and process innovation.
- Water & Power Demand: Semiconductor fabs are extremely water- and power-intensive — Dholera needs ~100 MLD of ultra-pure water.
- Environmental Footprint: Solvents, gases, and waste from semiconductor manufacturing require stringent management.
Keywords & Definitions
▸ Semiconductor: A material (typically silicon) with conductivity between a conductor and an insulator; the building block of all modern electronics.
▸ ATMP (Assembly, Testing, Marking and Packaging): The “back-end” of semiconductor manufacturing — wafers from the fab are diced, packaged, marked, and tested before shipment.
▸ OSAT (Outsourced Semiconductor Assembly and Test): Third-party companies that perform ATMP services for chip designers and fab owners.
▸ FAB (Fabrication Facility): Front-end semiconductor manufacturing plant where silicon wafers are etched with circuits through photolithography.
▸ Cleanroom (Class 10K / 100K): Controlled-environment manufacturing space with strict limits on dust particles. Class 10K allows max 10,000 particles ≥0.5 µm per cubic foot; Class 100K allows 100,000.
▸ India Semiconductor Mission (ISM): Launched in December 2021 with ~₹76,000 crore outlay; nodal mission under MeitY to build a sustainable semiconductor and display ecosystem in India.
▸ SPECS (Scheme for Promotion of Manufacturing of Electronic Components and Semiconductors): Launched in April 2020; provides 25% capital subsidy on investments in eligible electronic components and semiconductors.
▸ EMC 2.0 (Electronics Manufacturing Clusters Scheme): Revamped in 2020; provides financial support to develop world-class infrastructure for EMCs.
▸ PLI Scheme: Production-Linked Incentive Scheme; provides incentives on incremental sales of products manufactured in India.
▸ DLI Scheme (Design Linked Incentive): Component of ISM providing financial incentives at various stages of chip design — Chip Design Infrastructure, Product Design, Deployment.
▸ Digital India Corporation (DIC): Non-profit company under MeitY; hosts the India Semiconductor Mission as an independent business division.
▸ eSIM (embedded SIM): A SIM card embedded into a device, programmable remotely — used in smartphones, IoT, automotive.
▸ RFID (Radio Frequency Identification): Wireless technology using electromagnetic fields to identify and track tags on objects — used in FASTag, e-passports, supply chain, etc.
▸ LED Driver IC: An integrated circuit that regulates power supply to LEDs in lighting and displays.
▸ Micro SD Card: Removable flash memory storage used in mobile phones, cameras, IoT devices.
▸ TSMC (Taiwan Semiconductor Manufacturing Company): World’s largest contract chip manufacturer (foundry), based in Taiwan.
▸ Quad CET Working Group: Critical and Emerging Technologies Working Group of the Quad (India, US, Japan, Australia) for supply chain resilience in semiconductors and emerging tech.
▸ iCET (Initiative on Critical and Emerging Technologies): Launched in 2023 by India and the USA; covers semiconductors, AI, quantum, space, and defence tech.
▸ Make in India: Flagship initiative launched in 2014 to make India a global manufacturing hub.
▸ Atmanirbhar Bharat: “Self-Reliant India” vision (2020) promoting indigenous capability across sectors.
▸ Photolithography: A process used in semiconductor manufacturing to transfer geometric patterns onto a silicon wafer using light.
Question Section (MCQs)
Q1. The first semiconductor ATMP/OSAT plant of Rajasthan has been set up at:
(a) Jaipur (b) Jodhpur (c) Bhiwadi (d) Kota
Q2. ATMP, in the context of the semiconductor industry, stands for:
(a) Advanced Testing and Microprocessor Production (b) Assembly, Testing, Marking and Packaging (c) Automatic Transmission and Manufacturing Process (d) Application Tracking and Module Packaging
Q3. Consider the following statements regarding the Bhiwadi semiconductor plant:
- It is India’s first SME-led ATMP/OSAT facility.
- It has been set up by Sahasra Semiconductors Pvt. Ltd.
- It will primarily manufacture front-end silicon wafers.
Which of the statements given above are correct?
(a) 1 and 2 only (b) 2 and 3 only (c) 1 and 3 only (d) 1, 2 and 3
Q4. The India Semiconductor Mission (ISM) was launched in:
(a) 2019 (b) 2020 (c) 2021 (d) 2023
Q5. The SPECS scheme of the Government of India provides:
(a) A 25% capital subsidy for manufacturing electronic components and semiconductors (b) A 50% interest subsidy on loans for MSMEs (c) A 100% tax holiday for chip designers (d) Free land in SEZs to semiconductor firms
Q6. The India Semiconductor Mission functions under which of the following ministries?
(a) Ministry of Commerce and Industry (b) Ministry of Electronics and Information Technology (MeitY) (c) Ministry of Heavy Industries (d) Ministry of Science and Technology
Q7. Consider the following statements about cleanrooms used in semiconductor plants:
- Cleanrooms are classified based on the number of particles per cubic foot.
- A Class 100K cleanroom is more strictly controlled than a Class 10K cleanroom.
- Cleanrooms are essential to prevent contamination during chip assembly and packaging.
Which of the statements given above are correct?
(a) 1 and 2 only (b) 2 and 3 only (c) 1 and 3 only (d) 1, 2 and 3
Q8. Which of the following products will be packaged at the Bhiwadi semiconductor plant?
- Micro SD cards
- Flash storage devices
- eSIMs
- RFID products
Select the correct answer using the code given below:
(a) 1 and 2 only (b) 1, 2 and 3 only (c) 2, 3 and 4 only (d) 1, 2, 3 and 4
Q9. The ‘iCET (Initiative on Critical and Emerging Technologies)’ was launched between India and which country?
(a) United Kingdom (b) Japan (c) United States (d) France
Q10. Match the following Indian semiconductor projects with their locations:
| Project | Location |
|---|---|
| A. Tata–PSMC Fab | 1. Bhiwadi, Rajasthan |
| B. Tata OSAT | 2. Sanand, Gujarat |
| C. Micron ATMP | 3. Dholera, Gujarat |
| D. Sahasra ATMP/OSAT | 4. Morigaon, Assam |
Select the correct answer:
(a) A-3, B-4, C-2, D-1 (b) A-1, B-2, C-3, D-4 (c) A-3, B-2, C-4, D-1 (d) A-4, B-3, C-1, D-2
Answer Key with Explanations
▸ Q1 → (c) Bhiwadi Rajasthan’s first semiconductor ATMP/OSAT plant has been set up at Bhiwadi, within the Electronics Manufacturing Cluster (EMC) at Salarpur, Khushkhera.
▸ Q2 → (b) ATMP stands for Assembly, Testing, Marking and Packaging — the back-end stage of the semiconductor manufacturing value chain.
▸ Q3 → (a) 1 and 2 only Statements 1 and 2 are correct. Statement 3 is wrong — the plant is an ATMP/OSAT facility, i.e., back-end packaging and testing, not a front-end wafer fabrication (FAB) facility.
▸ Q4 → (c) 2021 The India Semiconductor Mission (ISM) was launched in December 2021 with an outlay of ~₹76,000 crore, as part of India’s strategic push to build a domestic semiconductor and display ecosystem.
▸ Q5 → (a) The SPECS scheme, launched in April 2020, provides a 25% capital subsidy on investment in identified electronic components and semiconductors. Outlay is ₹3,285 crore.
▸ Q6 → (b) The India Semiconductor Mission (ISM) functions under the Ministry of Electronics and Information Technology (MeitY) and is hosted as an Independent Business Division within the Digital India Corporation.
▸ Q7 → (c) 1 and 3 only Statements 1 and 3 are correct. Statement 2 is wrong — a Class 10K cleanroom is more strictly controlled (allows fewer particles) than a Class 100K cleanroom. Lower number = stricter standard.
▸ Q8 → (d) 1, 2, 3 and 4 The Bhiwadi plant will package Micro SD cards, flash storage devices, LED driver ICs, eSIMs, and RFID products — all of which are crucial for India’s digital and IoT ecosystem.
▸ Q9 → (c) United States The iCET (Initiative on Critical and Emerging Technologies) was launched in January 2023 between India and the United States, covering semiconductors, AI, quantum, biotech, space, and defence technologies.
▸ Q10 → (c) A-3, B-4, C-2, D-1 Tata–PSMC Fab — Dholera, Gujarat; Tata OSAT — Morigaon, Assam; Micron ATMP — Sanand, Gujarat; Sahasra ATMP/OSAT — Bhiwadi, Rajasthan.
