- The Senate approved a $280 billion bill to boost the U.S. semiconductor industry, reducing its dependence on its Asian counterparts like China, the Wall Street Journal reports.
- The CHIPS and Science Act of 2022 would spend $52.7 billion on direct financial assistance for the construction and expansion of semiconductor manufacturing facilities. It adds $24 billion in tax incentives.
- It would also turbocharge federal spending on scientific research.
- Also Read: US Debates Importance Of Chips Act; Its Repercussions On China
- The bill allocates $39 billion for semiconductor manufacturing, including $11 billion to advance semiconductor manufacturing research and workforce training, and a $2 billion fund to more quickly translate laboratory advances into military and other applications.
- The bill was approved 64-33, reflecting growing concern in both parties over the lack of a long-term solution to Beijing's technological and economic rise significantly in the backdrop of the pandemic that disrupted chip supplies from Asia, with fallout across major industries.
- Companies that could tap the funding for U.S. expansions include Intel Corp INTC, Taiwan Semiconductor Manufacturing Co Ltd TSM, GlobalFoundries Inc GFS, Micron Technology Inc MU, Applied Materials Inc AMAT and more.
- Previously, the government's dillydallying over the bill had upset Intel and TSMC. They were amid building plants in the U.S., entailing deep investments spurred partly by the promise of government incentives.
- The pandemic played a significant role in vandalizing the semiconductor supply chain. The crisis got further aggravated as chipmakers focused on smartphones, PCs, and laptops as the world moved online during the pandemic at the cost of the carmakers and other industries.
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