Synopsis-
The CHIPS and Science Act signed into law by President Joe Biden on August 9, 2022, is a U.S. federal statute enacted by the 117th United States Congress. The act offers approx $280 billion in new funding to enhance domestic research and manufacturing of semiconductors in the USA.
Semiconductor industry is still waiting on the windfall even after the act was signed by President Joe Biden one year ago.
Reacting to this, Gina Raimondo, Secretary of Commerce, US, said, “We will start to give out the money later this year,”.
What was the goal of the CHIPS and Science Act?
The act aimed to onshore the American semiconductor supply chain, and in return boost national security by reducing reliance on foreign countries. The law forbids receiving funds from expanding semiconductor manufacturing in China or other countries posing a high risk to America’s national security.
The federal subsidies by the government are to help offset the towering cost of creating these manufacturing hubs, but so far, no subsidy has been awarded by the legislation.
Raimondo said the Department of Commerce has received “over 460 statements of interest from companies around the world” hoping to get funding for their projects. That’s an increase from the agency’s last update, which had released a figure of “nearly 400.”
Federal Funding Stimulated Huge Investments in Semiconductor Industry-
The potential for federal funding has encouraged some huge investments in the semiconductor industry. In total, the legislation has announced $231 billion in private-sector semiconductor investments. But many of the projects are still on hold as they haven’t received any funding to date. The project would bring approx 2000 direct, high-paying jobs.
For instance, Integra Technologies, a semiconductor packager, plans to create a 1-million-square-foot facility in Wichita, said, it can receive the federal funding.
Brett Robinson, CEO, Integra Technologies, said, “Once it’s up and running and operational, the company can sustain the business with no further government support,” Robinson said. “it’s just that extreme amount of cost and time that it takes to get the facility built,” that requires government help.
