Centre notifies SEZ for setting up India’s first chip fabrication plant at Dholera

New Delhi, April 16 The Central government has notified the setting up of an SEZ by Tata Semiconductor Manufacturing Private Limited exclusively for electronic hardware and software, including IT/ITES, at Gujarat's Dholera, the Ministry of Commerce and Industry said on Thursday.

Spread across 66.166 hectares and poised to provide employment to 21, 000 persons, the SEZ is designed to support electronic hardware, software, and IT-enabled services, and includes enabling infrastructure and a dedicated approval mechanism to streamline operations and logistics. This is India’s first chip fabrication plant, according to the ministry statement.

Earlier, the government had taken several significant steps to strengthen India’s semiconductor and electronics manufacturing ecosystem through progressive reforms in the Special Economic Zones (SEZ) law and targeted approvals of sector-specific SEZs. In line with the government’s focus, these reforms are aimed at promoting high-value, capital-intensive investments, fostering innovation, and enhancing ease of doing business in developing a globally competitive semiconductor ecosystem.

Key amendments to the SEZ Rules, 2006 were carried out through the notification dated June 3, 2025 to address the unique requirements of semiconductor and electronics manufacturing, including reduction in minimum land requirement from 50 hectares to 10 hectares, flexibility in encumbrance norms, inclusion of free-of-cost supplies in Net Foreign Exchange calculations, and permitting domestic sales in the Domestic Tariff Area (DTA) on payment of applicable duties.

Following through on these reforms, the Board of Approval for SEZs has accorded approvals to major proposals for setting up SEZs for semiconductor and electronics.

Notably, Micron Semiconductor Technology India Pvt Ltd is establishing an SEZ for semiconductor assembly, testing, marking and packaging in Gujarat's Sanand, with an estimated investment of Rs 13,000 crore, while Aequs Group is setting up an electronic component manufacturing SEZ in Karnataka's Dharwad. The other proposals that have been approved include CG Semi, Kaynes Semicon, and the Hubballi Durable Goods Cluster. These projects are expected to catalyse the development of domestic value chains, generate high-skilled employment, and reduce import dependence.

These SEZs are envisaged to contribute to the gradual build-up of a robust, competitive, resilient, and future-ready semiconductor ecosystem. These initiatives, together with industry participation and policy support, are facilitating and paving a way for the creation of integrated manufacturing clusters, strengthening domestic capabilities, and positioning India as an emerging hub for semiconductor and electronics production, the statement added.

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