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Special Content

Issue no 33, 11-17 November 2023

India's Roadmap to Become a Semiconductor Superpower


Aspiring to become a top global economy and superpower, India strategically prioritises self-reliance (AatmaNirbharta), with technology playing a pivotal role in this pursuit. Essential to various sectors and a linchpin for global economic growth and innovation. The semiconductor industry,  is a prime focus for India. As the nation strengthens its emphasis on semiconductor manu-facturing, it has entered into significant agreements for collaboration with the industry leaders. Most recently, a Memorandum of Cooperation (MoC) was signed with Japan for collaboration in the semiconductor supply chain.

What are semiconductors?

Semiconductors play a pivotal role in modern electronics by regulating the flow of electric currents, making them indispensable in today's technological landscape. Their unique characteristics position them between highly conductive materials like copper and aluminum and non-conductive substances like rubber and glass. Typically crafted from materials such as silicon, germanium, and gallium, semiconductors are known for their reliability, compactness, cost-effective-ness, and their capacity to handle high voltages.

In the present era, semiconductors find applications in virtually every sector and industry. From electronic devices to information and communication techno-logies (ICT), computing, healthcare, military systems, transportation, and clean energy, semiconductors have become indispensable components of our societal infrastructure. Moreover, semiconductors, along with displays, serve as the bedrock of modern electronics, propelling the next wave of digital transformation in the context of Industry 4.0.

How is India reshaping the semi-conductor world order?

There are a limited number of dominant players in the semiconductor industry, such as the United States of America, Taiwan, South Korea, Japan, and China.  With the disruptions caused by the pandemic and the Russia-Ukraine conflict, India recognized the imperative of establishing a resilient supply chain network through trusted partnerships. At the inauguration of ‘Semicon India 2023’ Prime Minister remarked "Anyone who wants to be a part of the world's most vibrant and unified market has trust in India. When we ask you to 'Make in India', it also means that let's Make for India and Make for the world. "By positioning itself as a dependable partner, India has made a strong case for becoming a global semiconductor hub.

In recent developments, the Union Cabinet has given its approval for a Memorandum of Cooperation (MoC) between India and Japan, focused on establishing the Japan-India Semi-conductor Supply Chain Partnership. Additionally, TATA Projects has successfully secured the contract to construct Micron Technology's advanced semiconductor assembly and testing facility in Sanand, Gujarat. These instances highlight the collaborative efforts that India is actively engaged in to realize its semiconductor vision.

In alignment with India's presidency within the G-20 and its overarching theme of 'one earth, one family, one future,' the Prime Minister reiterated a similar sentiment during his address at the Semicon India Summit 2023. He expressed the aspiration to transform India into a prominent semiconductor manufacturing hub, underpinned by a spirit of global cooperation and shared progress.

Fueling India's Economic Growth

According to the annual report of the Ministry of Electronics & Information Technology (MeitY) "Electronics hardware industry is the world's largest and fastest growing industry with its increasing applications in all sectors of the economy. The domestic production of electronic items has increased from Rs. 3,17,331 crore (USD 49 billion) in 2016-17 to

Rs. 6,40,810 crore (USD 87.1 billion) in 2021-22. India's electronics production is expected to reach USD 300 billion by 2026."

It has been estimated that the semiconductor industry in India will generate a demand for 1.2 million jobs encompassing a wide range of roles, including engineers, operators, technicians, and more. This demand is expected to grow as manufacturing advances and design functions evolve. To meet the skill and talent pool demands of this growing industry there have been changes made to the engineering curriculum to create a semiconductor ecosystem. More than 300 such major colleges have been identified in India, where courses on semiconductors will be available.

The Union Minister of State for Electronics and IT Shri Rajeev Chandrashekhar has stated that "Under Semicon India, over 30 semiconductor design start-ups have been set up in India including some from semiconductor leaders from Silicon Valley. Five start-ups have already received government financial support and another 25 start-ups are being evaluated for the proposals for NextGen products and devices," The country will leverage its extensive talent pool, comprisinghighly skilled engineers and designers, to make this vision a reality. With the growing demand for electronics, increasing digital literacy, and the government's shift towards its agenda of clean energy, the semiconductor industry will fuel the economic engines of the country to take it to newer heights. These strategic initiatives are anticipated to yield a favourable domino effect on India's economic growth, facilitating deeper integration into the global value chain across various sectors of the economy.

India Semiconductor Mission

India, acknowledging the critical importance of semiconductors and the remarkable growth of electronic and digital manufacturing sectors, has strategically harnessed their potential to establish itself as a significant player in the global landscape. As a testament to this commitment, India Semiconductor Mission (ISM) has been set up as an Independent Business Division within Digital India Corporation. It will have the administrative and financial autonomy to formulate India's long-term strategies for developing semiconductors and display manufacturing facilities. With a total outlay of 76,000 crore, the programme aims to provide financial support to companies investing in semiconductors, display manufacturing, and design ecosystems. This will serve to pave the way for India's growing presence in the global electronics value chains.

Along with this, several initiatives have been launched to promote semiconductor production, including the Production Linked Incentive (PLI) scheme for the electronics sector, Chips to Startup (C2S), and Scheme for Promotion of Electronic Components and Semiconductors (SPECS) to support the industry.

With a strong commitment to fostering a thriving semiconductor ecosystem, the government has implemented proactive measures to streamline regulatory processes and introduce financial incentives that underscore the industry's importance. Highlighting the importance of public-private partnerships and invest-ments, the government is committed to making a thriving ecosystem for the semiconductor industry in India. India's shift from primarily exporting mobile phones to becoming a burgeoning mobile device manufacturer demonstrates the nation's increasing capabilities in this field. With a commitment to 'Make in India' and 'Make for the World,' India is moving towards becoming a global semi-conductor hub, impacting not only its economy but also the world's technological landscape.

Compiled by Kaushikee and Induja Tyagi.

Source: PIB, PM speeches, MeitY