Special Correspondent

Plans Assembly, Test, Mark, Packing unit close to the fab plant

AMD to provide dual core technologyWater was the key determinant1,200 acre site located

BANGALORE: Hyderabad beat other contenders such as Bangalore and Chennai to bag the mandate for locating India's first semiconductor wafer fabrication or `fab' plant to be set up by SemIndia Inc. with dual core microprocessor technology licensed from the U.S.-based chipmaker Advanced Micro Devices (AMD) Inc. with an investment of $3 billion.

SemIndia will also set up an assembly, test, mark, packing (ATMP) facility close to the fab unit.

"Several states, including Karnataka and Tamil Nadu, were trying to compete with each other to grab the fab project. But, Andhra Pradesh has come up trumps," Dayanidhi Maran, Union Minister of Communications and Information Technology, announced on Thursday at the Vision Summit organised here by the India Semiconductor Association (ISA).

Karnataka and Andhra Pradesh were "pro-active" in their pursuit to locate the SemIndia plant in their respective states by offering land, quality power and water besides road and airport infrastructure, he said.

Mr. Maran said the recent political developments in Karnataka might have ruined Bangalore's prospects to host the silicon chip making plant, while Tamil Nadu was "lukewarm to the proposal and never gave any encouragement".

Andhra Pradesh was much faster in its response, Mr. Maran said while praising the Andhra Pradesh Chief Minister, Y. S. Rajasekhara Reddy, for taking a "personal interest" and swinging the project in favour of Hyderabad.

Mr. Maran said supply of abundant and good quality water was the key element that clinched the project for Hyderabad. " Water was the major factor. Tamil Nadu said it did not have enough water, whereas Andhra Pradesh assured abundant supply of water," he said.

"If the Government is pro-active, it makes a lot of difference. Besides, investors were more comfortable in locating the fab in Hyderabad," Mr. Maran said, adding that he had no role to play in choosing the location.

The SemIndia plant is expected to come up on 1,200 acres at Srinagar, close to upcoming international airport at Shamshabad near Hyderabad.

Mr. Maran said the success of the anchor fab in the country was important as this would instil confidence and spur a few more players to set up chip making plants.

"States that provide proper infrastructure and ambience for setting up fabs along with incentives will stand to benefit from the huge employment that will be generated in running the foundries," he said.

However, SemIndia President and CEO, Vinod K. Agarwal, and C. S. Rao, Advisor (IT) and CEO, AP Invest, Andhra Pradesh, were tight-lipped about the finer details of the fab project such as equity participation by the state government and subsidy/grant to be offered to SemIndia for setting up the plant.