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Micron plant’s groundbreaking ceremony is a big milestone for the growth of digital economy in the country that will send a signal about India’s potential in the semiconductor space to prospective investors, Union Minister Rajeev Chandrasekhar said on Friday.

Computer storage chip maker Micron will start building its semiconductor assembly and test plant from Saturday in Gujarat which entails a total investment of $2.75 billion (around Rs 22,540 crore).

Micron will invest up to $825 million in setting up the plant in two phases and the rest of the investment will come from the centre and the state government.

“Micron groundbreaking ceremony sends a signal about growth and evolution of semiconductor ecosystem in India to other prospective investors. Broadly for the economy, the digital economy target of being 20% of GDP and the growth of digital economy and in particular the semiconductor ecosystem, tomorrow’s groundbreaking is a big milestone,” the Minister of State for Electronics and IT told reporters.

The minister said that more applications for semiconductor manufacturing in the country are being processed.

He said that in the next 10 years, India will reach a stage where several countries failed to reach despite spending billions of dollars.

The minister said that leading semiconductor companies like Qualcomm and Nvidia don’t have semiconductor manufacturing plants but are valued more than those who make wafers.

“We are straddling both sides of the semiconductor ecosystem. We are now expanding the DLI (design linked incentive) scheme to include foreign companies that will partner with Indian startups to design in India,” Chandrasekhar said.

Foreign companies will get grants under the DLI scheme only if the intellectual property right is registered in India.

The minister said that the government is also considering setting up a GPU (graphics processing unit) cluster to support the development of artificial intelligence technology in the country.