Union Government of India approved two plant to manufacture Semiconductor chips

The Union Government approved the setting up of two plants to manufacture semiconductor chips in India on 14 February 2014. The plants will be set up by two business consortia, including Israel's Tower Jazz-IBM and STMicroelectronics at a cost of around 63412 crore Rupees.

Semiconductor is a hardware component, which is crucial to the functioning of various electronic devices such as, transistors, mobile phones, computers and hi-tech defence equipment. 

The government is offering 25% subsidy on capital expenditure, tax breaks and 5124 crore Rupees to each plant as interest-free loans in a bid to attract chip makers. They will benefit under section 35 AD of I-T Act and will also be allowed to deduct 100% expenditure made on research and development for development of electronic chips.