NEW DELHI
MARCH 27, 2007

Hindustan Semiconductor Manufacturing Corporation today announced the setting-up of its semiconductor foundry in India.

For this purpose, the HSMC has partnered with Germany-based Infineon Technologies for CMOS licences.

HSMC Chairman, Dr Devendra Verma, announced this to the media after signing of the Memorandum of Understanding (MoU) with Infineon's CEO Dr Wolfgang Zeibart, in the presence of Union Communications and IT minister Dayanidhi Maran here.

“We believe that the Semiconductor industry will play a major role in growing the GDP of the country,” Verma said. “And the Semicon policy notified a week back enables us to take the project of establishing a foundry in India to the next stage. This initiative will lead India to become a destination of choice for the future of manufacturing high-tech products.”

Verma informed that HSMC would be setting-up a semiconductor foundry in India, which can house eight to ten Fabs in the next 7-8 years. “Initially, we will establish two manufacturing facilities. The first Fab will require an investment of $1 billion and will produce 8-inch wafers. The second Fab will be more for advanced 12-inch wafers requiring an investment of $3.2 to $3.5 billion.”

HSMC, which will be employing 3000 people directly and another 30,000 indirectly, plans to roll out its first products within two years.

On partnering with Infineon Technologies, Verma said that a successful foundry project depended on the selecting the right and reliable partners. “All the partners namely Siemens, US Filters, Air Liquide, and Fairwood will have equity participation, except Infineon, and we are in the process of financial closure with some of the major investors,” he said.

“The current perception in the world is that India Inc. is for software development and design, while China is for hardware manufacturing. We want to change this perception and have decided to establish the Semiconductor foundry. This will be the single most gratifying achievement for us NRIs (Non-Resident Indian),” he added.

Infineon's Dr Zeibart said his company will offer on license to HSMC, the cutting-edge CMOS 130nm technology. “The silicon-proven design and technology is used for communication, automotive, and smart card applications from Infineon. Infineon will be involved from the project management/ consultation right from ground breaking to completion level,” he said.

Stating that the MoU was in line with his vision on Semiconductor industry, Dayanidhi Maran said that most of the Infineon products have large market potential for India.

“The domestic demand for semiconductors is projected to reach $36 billion by 2015 riding on the booming electronic goods manufacturing in India. We need the fabrication industry in India to complete the full semiconductor ecosystem. Now, with a clear cut policy in place, Fab units in India will attract large investments, and the state governments could take it further by attracting large players like Infineon and HSMC,” he added.

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