Micron close to Indian manufacturing deal, says report

Business news | January 30, 2023

By Peter Clarke

Talks between memory chip maker Micron Technology Inc. (Boise, Idaho) and the Indian state of Gujurat about investing $10 billion in manufacturing facilities there, are at an advanced stage, according to the Times of India.

The allocation of a 300,000 square metre parcel of land parcel between Ahmedabad and Sanand is being finalized, the report said, referencing an unnamed government source. “The company will soon announce setting up a manufacturing facility for data storage devices along with assembly, testing, marking and packaging here,” the report quoted the source saying. An official announcement is expected in a few weeks, the report added.

When emailed by eeNews Europe, Micron neither confirmed nor denied the Gujurat project.

A spokesperson for Micron said: “Micron continues to evaluate opportunities for potential future assembly and test project options needed to meet long-term memory demand. We have not made any decisions regarding the timing or scope of any expansion plans.”

It therefore remains unclear whether any potential Gujurat deal would include a wafer fab.

If Micron were to go forward in India it could begin with memory chip and memory module assembly, packaging and test, possibly for several years, before committing to IC production.

In October 2021 Micron CEO Sanjay Mehrotra announced his company would be investing $150 billion in global manufacturing and research over the next decade (see Micron plans to spend $150 billion on memory production). In October 2022 Micron announced a plan to invest $100 billion over a twenty-year period in a megafab complex in Clay, New York (see Micron to build $100 billion megafab in New York state).

However, in the short-term Micron has been cutting its cloth to cope with a glut of memory stock and a fall in average selling prices for memories. Micron has curtailed its output and is looking to lay off 10 percent of its staff during 2023 (see Micron cuts memory production by 20% and Micron to cut 10% of work force).

The state of Gujurat has one of the more generous support packages designed to encourage semiconductor investment. This includes a 10-year subsidy for the cost of electricity. Such packages complement an Indian federal subsidy plan that has been trying to attract investors (see Report: India plans $10 billion semiconductor subsidy).

Gujurat has already attracted one semiconductor joint venture, that between metals and mining conglomerate Vedanta and Hon Hai Precision Industries aka Foxconn (see Foxconn Indian fab venture selects Gujurat for location). Elsewhere Tata has expressed a desire to move into the semiconductor sector. However, such projects have been criticised for lacking world-class knowhow in establishing semiconductor manufacturing facilities.

Elsewhere in the country Indian Semiconductor Manufacturing Co. Ltd. (ISMC), a joint venture between Tower Semiconductor Ltd. (Migdal Haemek, Israel) and Abu Dhabi based Next Orbit Ventures, has signed a memorandum of understanding that it will create an analog wafer fab in Mysuru’s Kochanahalli industrial area, in the state of Karnatika. While Tower has the knowhow to operate such a fab it’s own future is uncertain as it has agreed to be taken over by Intel; a deal that is awaiting regulatory approval.

Foundry Power Semiconductor Manufacturing Co. (Hsinchu, Taiwan), was also recently reported to be in talks with the Indian government about helping build a wafer fab.