India Plans Regulatory Changes for Semiconductor Equipment and Auto Component Manufacturers

India is to amend regulations and bring in new rules within two months after concerns were raised by companies looking to manufacture semiconductor equipment and automotive components in the country, Commerce and Industry Minister Piyush Goyal said, according to The Moneycontrol report. 

Speaking at a Nikkei Asia event in Tokyo, Goyal said he had met two large companies that had flagged issues related to their proposed manufacturing operations. He said the government had assured them that the regulations would be changed to address those concerns. 

The government has already decided on the broad framework for the changes, according to Goyal. 

BIS Process to Be Eased 

The government has also simplified the Bureau of Indian Standards, or BIS, framework and is working on making the approval process easier, Goyal said. 

The changes are expected to cover cases where companies need to source equipment or components from suppliers outside India. Suppliers that are not covered under the revised regulations are also being considered as part of the process. 

Goyal, however, said some requests could be difficult to accommodate where they involved imports from countries associated with predatory pricing or unfair trading practices. 

Semiconductor Spending Programme 

The planned changes come as India continues to build its semiconductor manufacturing sector. The Union Cabinet has approved Semicon 2.0 with a budget outlay of ₹1,27,500 crore for semiconductor design and manufacturing. 

Goyal said the government and private sector were looking to seed around $50 billion in semiconductor and related industries over the next 18 months. 

He said the government would move to Semicon 3.0 after the next phase of investment and development. 

India-Japan Manufacturing Talks 

Goyal is visiting Japan from August 24 to 27 with a business delegation of more than 200 representatives. The delegation includes companies from manufacturing, semiconductors, clean energy, steel, automotive, financial services, and healthcare. 

During the visit, Goyal said India and Japan were discussing cooperation in areas including semiconductors, automotive components, artificial intelligence and space. 

The AI discussions cover large language models, applications, equipment, semiconductors, computing infrastructure, data centres and energy requirements. 

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Conclusion 

The proposed changes are expected to be introduced within two months, with the government seeking to address the issues raised by companies planning manufacturing operations in India. 

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