Japanese chipmaker Renesas Electronics and India's Tata Motors (TTM.US) have formed a strategic partnership to jointly design, develop and manufacture semiconductor solutions, the companies said on Wednesday.
Renesas Electronics will partner with Tata Motors, India's largest electric vehicle maker, to develop "next-generation automotive electronics" to accelerate the growth of electric and connected vehicles, the companies said in a statement.
NatarajanChandrasekaran, chairman of Tata Sons, the group's holding company, said: "this partnership will accelerate our presence in these areas in India and globally."
Areas of cooperation between the two companies include non-exclusive partnerships in emerging automotive technologies such as Advanced Driver Assistance Systems (ADAS) and wireless networking solutions including 5G, according to the statement.
As part of the collaboration, Renesas Electronics will also work with Tata Group's Tejas Networks to develop products initially for India and eventually for the global market.
It is understood that India is racing to subsidise the construction of domestic semiconductor and display plants to minimise supply risks. The country's $10bn incentive scheme has attracted applications from companies including a joint venture between Vedanta, a domestic conglomerate, and foxconn of Taiwan, and IGSSVentures of Singapore.
Indian mining giant Vedanta plans to invest $20 billion to build two chip and display manufacturing plants, while RajeshExports, a multinational gold retailer, will invest $3 billion to build an electronic display plant, according to reports.
India expects the domestic chip market to grow from $15bn in 2020 to $63bn by 2026.