Govt faces Rs 20,000 crore modernization cost for SCL Fab plant

The government’s modernisation plan for the Mohali-based Semi-Conductor Laboratory (SCL) will require an investment of Rs 20,000 crore for a new fabrication (fab, or foundry) plant with a capacity of 20,000 wafers per month, according to government estimates. (The Tata fab plant in Dholera, Gujarat, will produce 50,000 wafers per month).

The plan also envisions moving SCL away from its dependence on high nodes of 180 nanometres (nm), which have limited uses, towards 28 nm and then down to 14 nm.

The idea is to establish a research and development (R&D)/prototype centre of excellence with 300-millimetre wafer processing on advanced nodes.

“SCL cannot survive solely as an R&D centre. That is why we are also considering a reasonably sized commercial fab unit of 20,000 wafers per month, which will require around Rs 20,000 crore to set up. Additionally, it will transition to lower nodes like 28 nm,” said a senior Ministry of Electronics and Information Technology (Meity) official.

The official stated that the ministry is now seeking technology/commercial partners to undertake the modernisation. This could be a global company or a consortium led by an Indian company.

SCL is an autonomous society under Meity, with two fab lines supplying chips to government bodies.

According to reports, as many as nine companies have expressed interest in modernisation, including Tata and Israel’s Tower Semiconductor.

The government has offered two models to those interested in setting up the fab plant. One is a multi-entity joint venture model, where the government will contribute up to 50 per cent of the capital cost and provide majority control and operational autonomy.

The other allows the applicant to build, operate, and maintain the plant for a minimum of 15 years, extendable with the government infusing 100 per cent of the modernisation cost and retaining 100 per cent ownership. Business Standard