--- title: "To Compete with China US Senate has passed the CHIPS Act to Boost the Domestic Chip Manufacturing" description: "The US Senate has passed sweeping legislation to subsidise the domestic semiconductor industry, it has a hope to boost companies as they compete with" author: "Siddhi Shaw" published: 2022-07-28 canonical: https://www.mindstick.com/news/1805/to-compete-with-china-us-senate-has-passed-the-chips-act-to-boost-the-domestic-chip-manufacturing category: "science and technology" tags: ["usa", "china sourcing agent", "science and technology"] reading_time: 3 minutes --- # To Compete with China US Senate has passed the CHIPS Act to Boost the Domestic Chip Manufacturing On **Wednesday**, the **US Senate** has passed sweeping legislation in order to subsidise the domestic semiconductor industry, it has a hope to boost companies as they compete with [China](https://www.mindstick.com/news/1149/alibaba-will-design-its-own-chips-pushed-by-china-promoting-self-reliance) and alleviate a persistent shortage that has completely affected everything from cars, weapons, washing machines and video games. ``` HIGHLIGHTS A vote was planned by the House of Representatives on the long-awaited bill $170 billion was authorised for five years to boost US scientific research The Chinese Embassy in Washington has asked China to 'firmly opposed' the bill ``` Also Read: [Google fired Artificial Intelligence Researcher in a dispute with Chip Design Research.](https://www.mindstick.com/news/1614/google-fired-artificial-intelligence-researcher-in-a-dispute-with-chip-design-research) Well, on **Thursday** the **[House of Representatives](https://answers.mindstick.com/qa/44599/which-party-won-the-highest-number-of-seats-in-the-recently-concluded-elections-to-the-house-of-representatives-of-the-netherlands)** had planned to vote on the long-awaited bill once the **Senate** passed it on a **64** to **33** bipartisan vote. If it gets approved as expected, **President Joe Biden** would plan to sign it into law early next week. The '**Chips and Science**' act provides around **$52 billion** (roughly Rs. 15,949 crore) in government subsidies for [US](https://www.mindstick.com/news/1788/us-investigation-claims-huawei-to-be-spying-over-military-bases) semiconductor production along with an investment tax credit for chip plants which was estimated to be worth **$24 billion** (roughly Rs. 1,913,93 crore). The legislation would be authorising over **$170 billion** (roughly Rs. 13,558,09 crore) for five years in order to boost US [scientific research](https://answers.mindstick.com/qa/107875/summarize-the-recent-breakthroughs-in-scientific-research) so that it could better compete with China. **Congress** would still have pass separate appropriations legislation in order to fund those investments. **Senator Mark Warner** had mentioned that the bill would help them to fund **10** to **15** new semiconductor factories. He cleared that '**if we haven’t done this, there would not be another US semiconductor manufacturing plant which would be get built this country ever**.' ![To Compete with China US Senate has passed the CHIPS Act to Boost the Domestic Chip Manufacturing](https://www.mindstick.com/usernews/645947/a42a69fe-2775-4439-ada2-b4f665b3078c/images/cfa86603-f8d5-459c-a247-251283d46453.jpeg)\ The **Chinese Embassy** in **Washington** has mentioned **China** to '**firmly opposed**' the bill that it said was '**entrenched in the Cold-War and zero-sum game mentality and runs counter to the common aspiration of individuals from all sectors in China and the US to strengthen exchanges and cooperation**.' Most of the funding was slated for brand new factories which would eventually take **2** or **3** years to build. Some authorities have mentioned that it still faces [supply chain](https://www.mindstick.com/news/1129/joe-biden-applauds-the-supply-chain-victory-but-issues-remain) problems from [chips shortages](https://www.mindstick.com/news/1298/the-us-will-release-chip-shortage-study-details-amid-funding-push). According to **Senator Mark Kelly**, if the US would lose the access to chips which were made in **Taiwan** then it would shrink **US Gross Domestic Product** by **10 percent** and would cripple auto production. [Joe Biden](https://www.mindstick.com/news/1634/jeff-bezos-responded-joe-biden-s-words-can-corporate-taxes-tame-inflation) had urged the House to quickly pass on the bill. After the Senate vote, he has mentioned that '**as Americans are worried regarding the [state of the economy](https://answers.mindstick.com/qa/108177/what-s-the-current-state-of-the-economy) and the value of living, the CHIPS bill would be considered as one answer: it would accelerate the production of semiconductors in America, lowering costs on everything from cars to dishwashers**.' Critic like **Senator Bernie Sanders** who was the only member of the **Senate Democratic** caucus to vote against the bill, has called the measure as the “**blank check**” to highly profitable chip manufacturers. Lawmakers have been engaged in working on alternative provisions that would address other supply chain vulnerabilities. Also Read: [Latest computer chip mimics like the human brain](https://www.mindstick.com/news/1751/latest-computer-chip-mimics-like-the-human-brain) --- Original Source: https://www.mindstick.com/news/1805/to-compete-with-china-us-senate-has-passed-the-chips-act-to-boost-the-domestic-chip-manufacturing Copyright © MindStick Software Pvt. Ltd. This Markdown version is provided for developers, AI systems, and offline reading.