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Red carpet for chip-makers

P. Manoj

Andhra Pradesh earmarks 350 acres in Hyderabad exclusively for fab city


  • Government offering free land
  • 50 acres allotted to South Korean firm Intellect

    Bangalore: Andhra Pradesh is wooing silicon chip-makers to Hyderabad by offering grants to service interest costs and free land to set up semiconductor fabrication plants commonly known as fabs.

    The Andhra Pradesh Government has demarcated 350 acres at Srinagar, close to the new international airport being built at Shamshabad near Hyderabad, exclusively for setting up a fab city with the infrastructure required for making chips, C.S. Rao, Adviser (IT), Andhra Pradesh Government told The Hindu .

    Out of this, 50 acres has been allotted free of cost to Intellect, a firm promoted by June Min of South Korea, for setting up a fab with a capacity to produce 30,000 silicon wafers a month. At a conservative rate, each acre will cost Rs. 20 lakhs, he said.

    The first phase of the plant will cost U.S. $650 million. Initially, Intellect plans to make chips of 0.25/0.18 microns that will be upgraded to 0.13 microns. In the second phase starting 2007-08, the company proposes to make chips of 0.095 or 0.060 microns with an investment of $2 billion, Dr. Rao said.

    "The State Government will support the project by servicing the interest burden of the company with a maximum grant of Rs. 350 crores spread over a ten-year period at the rate of Rs. 35 crore per annum and by providing water and electricity to the plant," Dr. Rao said.

    The State Government will earmark more land for setting up fabs if the need arises, he said.

    Proximity to the international airport is one of the key criteria for locating fabs.

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