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Chip maker Micron signs MoU with Gujarat government for setting up semiconductor facility

Chip maker Micron signs MoU with Gujarat government for setting up semiconductor facility
Micron’s facility in India will be constructed in Sanand, near the city of Ahmedabad in Gujarat.


Micron Technology, an American multinational chip developer, has signed a memorandum of understanding with the government of Gujarat for setting up a semiconductor facility in the state. The unit will be Micron’s first factory in the country.


The first chips will likely be manufactured within 18 months, PTI reported, quoting Union Electronics and Information Technology Minister Ashwini Vaishnaw. The minister added that more companies are in the pipeline to set up semiconductor facilities in the country.


The move follows Micron’s announcement last week about its plans to build a new assembly and test facility in India’s western state of Gujarat. The company says that the new factory will enable assembly and test manufacturing for both DRAM and NAND products and address demand from domestic and international markets.


A short detour, DRAM is a type of volatile memory that stores data temporarily while a device is powered on and is commonly found in computers, smartphones, gaming consoles, and other electronic devices. NAND, on the other hand, is a type of non-volatile memory that retains data even when the power is turned off. It is widely used in storage devices, such as solid-state drives (SSDs), USB flash drives, memory cards, and embedded systems.


Back to Micron’s facility in India, it will be constructed in Sanand, near the city of Ahmedabad in Gujarat. The Boise, Idaho-headquartered company said it chose Gujarat for establishing its chip plant due to the state’s “manufacturing infrastructure, conducive business environment and a well-established talent pipeline in the SANAND Industrial Park.” The semiconductor factory at Sanand will transform wafers into ball grid array (BGA) integrated circuit packages, memory modules, and solid-state drives, it said.


Micron Technology will invest up to $825 million over the two phases of the project and will create up to 5,000 new direct jobs and 15,000 community jobs over the next several years. The chip maker’s investment clubbed with support from India’s central government and the Gujarat government will result in a total investment of $2.75 billion for setting up the chip factory.


Furthermore, the semiconductor company will receive 50% fiscal support for the total project cost from the Indian government and incentives representing 20% of the total project cost from the state government. This financial support falls under the government’s Modified Assembly, Testing, Marking, and Packaging (ATMP) Scheme.


Meanwhile, Phase 1 of the Micron factory construction will likely begin this year. The first phase will include 500,000 square feet of planned cleanroom space, which will start to become operational in late 2024, and the company plans to gradually ramp up the capacity in line with global demand. Phase 2 of the project is expected to start towards the second half of the decade and would include the construction of a facility similar in scale to Phase 1.


“Micron’s investment to set up assembly and test manufacturing in India will fundamentally transform India’s semiconductor landscape and generate tens of thousands of high-tech and construction jobs,” Minister Vaishnaw said last week. “This investment will be a crucial building block in the country’s blossoming semiconductor ecosystem,” he added.


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