ST Plans Chip Manufacturing In India, Says Report

The report also said that ST was considering taking on thousands of extra workers to work at the facility.

ST declined to comment except to say that it had bought land, according to the report, but it quoted sources saying ST, “is contemplating a full-fledged chip manufacturing facility in India in view of the rapid growth in chip consuming industries in India including mobile phones, consumer electronics and automobiles.”

It still remains unclear whether this means a wafer fab, which is the investment-intensive front-end of chip manufacture, or a chip test and assembly facility, which is relatively less costly and less technologically-intensive than making wafers of integrated circuits.

ST has been present in India for over a decade and employs about a 1,500 engineers at its two centers in Noida and Bangalore. It plans to increase staff strength to 5,000 in three years, with most of the new recruits to be located at the newly acquired site, the report said.

“If electronic companies continue to set up manufacturing bases in India and expand their capacity to meet the burgeoning domestic demand, the semiconductor industry will receive an even greater boost,” the report quoted Vivek Sharma, vice president and director, India Product Development Factory, ST Microelectronics Pvt. Ltd., Noida, as saying. “We want to move up the value chain,” Sharma was also quoted as saying.

High-end manufacturing was not feasible in India in the past because of a lack of domestic demand and a lack of engineers willing to stay in the country. Although India has produced many electronic engineers of the highest quality over the last couple of decades they have often used their skills as ticket to leave India. Some, with western hemisphere experience, are now returning to India eager to help their homeland develop.

ST executives, when contacted, did not return calls seeking comment.