India is planning to roll out a multi-billion-dollar capital support and production-linked incentive plan to push manufacturing of semiconductors in the country, top sources have told TOI.

Sources said senior officers were in talks with some of the top semiconductor manufacturers such as Taiwan Semiconductor Manufacturing Co. (TSMC), Intel, AMD, Fujitsu, United Microelectronics Corp.

“The government is willing to talk capital support. We are closer to it like never before,” said a top source engaged in the process.

The move comes at a time when a global chip shortage has massively affected production in industries across several sectors.

The plan is being coordinated and monitored closely by the Prime Minister’s Office (PMO) and multiple ministries have been roped into the process, the TOI report said.

Sources said efforts would be made to formulate an “attractive and investment-conducive scheme” for companies.

Financial support on capital expenditure, tariff reductions on certain components, and benefits through programmes such as Scheme for Promotion of Manufacturing of Electronic Components and Semiconductors (SPECS) and production-linked incentive (PLI) could be on the cards.

Previous attempts failed to get companies to invest in manufacturing semiconductors because sophisticated processes require heavy investments, besides an uninterrupted supply of clean water and electricity.

“The domestic demand is going to be very high. The government expects domestic production of electronics to move up to $350-400 billion by 2025, against the estimated $75 billion now. This will be a big enabler to get in investments,” the source said.