Tower Semiconductor, an Israeli based semiconductor manufacturer (including silicon-germanium) submitted a proposal to construct a fabrication plant in India.

Following multiple investments across the world, Tower Semiconductor seeks to expand manufacturing capabilities into the Indian market. The Indian government is assessing the proposal, with hopes to clear it before the model code of conduct kicks in ahead of the Indian elections this year. 

This is not the first time Tower has indicated they intend to construct a fabrication plant in India. The first attempt at entering the Indian market was halted, when a US$3Bn fabrication plant, which was planned to be constructed in Karnataka, ultimately failed when Intel announced their plans to acquire Tower for US$5Bn. However, this acquisition fell through when Intel cancelled their acquisition, citing regulatory issues from international bodies. 

The new fabrication plant is set to have a higher capital investment at US$5Bn more than the previous planned amount. The higher investment amount is believed to be able to meet domestic demand, especially for 65nm and 40nm chips. 

Other manufacturers have shown interest into entering the Indian market. Micron Technology is due to set up a chip packaging plant in the country - a full-fledged fabrication facility is yet to be cleared for approval. Foxconn, also known as the manufacturer of the iPhone, and Vedanta, established a joint venture for a US$19.5Bn chip plant which came to an abrupt halt as Foxconn announced their removal from the venture. No further information has been revealed so far. 

India continues to seek investments for their domestic production of chips. However, they are well suited for their continued growth and domestic market requiring lower-end chips.