On Friday, the Indian government published its official decision to approve the construction of two semiconductor plants. One of them will be set up by a consortium led by US giant IBM that includes Israel's Tower Semiconductor Ltd. (Nasdaq: TSEM; TASE: TSEM) and Indian company Jaiprakash.
The investment by the IBM consortium is estimated at $4.1 billion. Tower is to contribute know-how and to advise on the construction of the plant in Uttar Pradesh. The other consortium comprises STMicroelectronics of France, HSMC Technologies (Hindustan Semiconductor Manufacturing Corporation) and Malaysia's Silterra.
Under the decision by the Indian government, letters of intent will be sent to the winners by the end of March this year, with the signing of binding agreements taking until August. The government also decided to set up a committee that will have all the authority required to execute the project.
The two consortia will benefit from tax breaks and other incentives offered by the Indian government.
India's demand for electronics products is expected to reach $400 billion by 2020. The country currently imports an estimated 90% of the consumer electronic products sold there.
Published by Globes [online], Israel business news - www.globes-online.com - on February 16, 2014
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