Centre nod to India’s 1st chip fabrication plant at Dholera SEZ

The Union Government on Thursday has notified that special economic zone (SEZ) to be set up by Tata Semiconductor Manufacturing exclusively for electronic hardware and software including IT/ITES at Dholera, Gujarat, according to statement by Commerce Ministry.

The SEZ will be spread over 66.166 hectares of land and is poised to provide employment to 21,000 persons, the statement shows.

Further, 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, the statement says. Earlier, the government had taken several significant steps to strengthen India’s semiconductor and electronics manufacturing ecosystem through progressive reforms in 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 on developing a globally competitive semiconductor ecosystem.

The key amendments to the SEZ Rules, 2006 were carried out through the notification dated 3 June 2025 to address the unique requirements of semiconductor and electronics manufacturing.

That included 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 of setting up of SEZs for semiconductor and electronics.

Notably, Micron Semiconductor Technology India Pvt Ltd is establishing an SEZ for semiconductor assembly, testing, marking and packaging in Sanand, Gujarat, with an estimated investment of Rs 13,000 crore.

Aequs Group is setting up an electronic component manufacturing SEZ in Dharwad, Karnataka. These projects are expected to catalyse the development of domestic value chains, generate high-skilled employment, and reduce import dependence.