Finance Minister Nirmala Sitharaman calls on US semiconductor makers to invest in India

Finance minister Nirmala Sitharaman has called on American semiconductor firms AMD, Western Digital and Micron Tech to boost investments in India, taking advantage of a Rs 76,000-crore production-linked incentive (PLI) scheme that was announced recently to woo large chip makers.

In a meeting in San Francisco with top executives of semiconductor firms, Sitharaman highlighted opportunities for American companies in India and laid emphasis on the government commitment to be a reliable player in the entire semiconductor value chain, at a time when global firms in this space are looking to diversify away from China.

Separately, India is in talks with global chipmakers Intel Corp, GlobalFoundries Inc and Taiwan Semiconductor Manufacturing Co about setting up local operations, part of efforts to centre more high-tech manufacturing in the country, according to Bloomberg. “Most of the pitches to these big companies, I’m making myself,” Rajeev Chandrasekhar, a former Intel engineer and current minister of state for technology and entrepreneurship, told the news agency. “We’re meeting the CEOs, talking to them, making presentations.”

Sitharaman also held a series of meetings with other investors in the US and exhorted them to be a part of the India story.

The country will remain the world’s fastest-growing large economy at least over the next two years, according to the International Monetary Fund’s projections.

A crippling shortage of semiconductors in the global market in the aftermath of the pandemic hit domestic supply of cars, laptops and cell phones, prompting the government to roll out the PLI scheme in December 2021 to boost manufacturing of chips in India.

Devinder Kumar, chief financial officer of AMD, spoke about the company’s growth in India and how the country could realise strong growth with the Atmanirbhar Bharat initiative.

Similarly, Dan Steere, senior vice-president (corporate business development) of Western Digital, said his company is excited to explore opportunities with the government to expand manufacturing in India. Manish Bhatia, executive vice-president (global operations) at Micron Tech, said the PLI scheme would help boost semiconductor manufacturing in India.

India will pip China in economic growth, despite the damaging impact of the Russia-Ukraine conflict and other external headwinds, according to the International Monetary Fund’s (IMF’s) projections. At 8.2%, India’s growth rate this year is forecast to surpass China’s 4.4%. Similarly, while India is expected to grow 6.9% in the next fiscal, China’s expansion is pegged at 5.1%. 

FM huddles with VCs, PE players

The finance minister also participated in a meeting with venture capitalists (VCs) and private equity (PE) investors focussed on the clean energy sector. The discussion covered the potential for generating clean energy in India, energy alternatives, waste-to-energy, Green Steel, carbon capture, etc, according to the finance ministry.

Mark Widmar, chief executive at First Solar, discussed with the finance minister his company’s $700-million investment in India, according to a finance ministry tweet. First Solar’s plant will be operational shortly in India and this is its lowest-cost factory across jurisdictions with very low carbon footprint and recycles 90% of the material, according to Widmar.

FM meets Uber CEO

Sitharaman met Uber chief executive Dara Khosrowshahi, who apprised her of the company’s expansion plan in India. Khosrowshahi said with investments made in the backend to support expansion, he is “positively confident” of quadrupling Uber’s growth in India, the according to a finance ministry tweet.

“Finance Minister Smt. @nsitharaman acknowledged @Uber’s expansion plans in India and said that technology plays an important role in strengthening transportation and mobility sectors as well as last mile connectivity,” another tweet said.