8730/22, 10:45 AM Made in Inia Semiconductor - A Late Approach at Right Time!
Made in India Semiconductor - A Late
Approach at Right Time!
2113.26
By OM Gupta = August 28,2022
India has been
leading in.
many technolog
ical sectors in
recent times,
Alike the
growing
semiconductor
boom, the
proliferation of
the IT sector in
the country has
been extolling.
Nonetheless,
India today is
the economic juggernaut across the world. According to a report by Nasscom, the Indian
software industry grew at >10% CAGR from 2019-22 to reach $13.3 Bn. The growth has
been propelled by the cloud shift and global market penetration. Software product
Industry has outperformed the overall industry growth in FY2022E and has grown by
18.7% compared to the tech industry which has grown by 16.3% in the same period.”
If you imagine an electronic device as a human then the software is its soul and
semiconductors are its heart. In India, domestic production of electronic goods has
increased to Rs 5,54,461 crore (USD 74,7 billion) in 2020-21 from Rs 2,43,263 crore
(USD 37 billion) in 2015+16 growing at a Compound Annual Growth Rate (CAGR) of 17.9
percent mainly depending on imports.
The elephant in the room:
India currently imports the majority of its semiconductor requirement from China, China
is one of India’s infamous neighbours. In recent years, the skirmish between India and
China has increased. Any escalation of tension between India and China can put India in
a dangerous spot which could impact both the hardware and software industries in India
since both are dependent on each other.
India faced a similar scenario in the pharmaceutical sector during covid due to its
dependence on China for Active pharmaceutical ingredients (API). When shipment from
China stopped during the lockdown, the government was forced to take many knee-jerk
actions.
India's other Semiconductor chip manufacturing friends:
India maintains a healthy relationship with many other semiconductor chips
manufacturing countries like Taiwan, the US, South Korea, Japan, etc. Only two
hitps:/timestech jnvmade-r-indi-semiconductor-2late-approach-atrightsime! we8730/22, 10:45 AM ‘Made in India Semiconductor —A Late Agproach at Right Time!
countries- Taiwan and South Korea are producing chips with the latest 7nm technology.
Intel's 7nm chips have seen several delays,
Industries all over the world are already facing semiconductor chip shortages and
tension with China will only aggravate the situation. Although China's Semiconductor
Manufacturing International Corporation (SMIC) hasn’t announced the production of 7am
chips, Some reports suggest that it is making 7nm at its foundry since last year,
Taiwan's TSMC is the largest producer of semiconductor chips in the world tension
between China-US-Taiwan can have global ramifications. The US through its Chips and
Science Act is trying to manufacture semiconductor chips back in the US.
Russia could be looked at as an example:
Russia started semiconductor manufacturing in the 1960s but it didn’t keep pace with
technological development. It is now using 20-year-old technology. US sanction has
further complicated things for Russia and its only hope is China. Some reports say that
Russia is in dire need of semiconductors for its missiles and fighter aircrafts and due to
this they lack many advanced features.
India's recent efforts:
India has been making efforts in manufacturing semiconductors in India but with no
success. In 2019, the government cancelled the Letter of Interest granted to Hindustan
Semiconductor Limited. Recently the government has announced its plan to upgrade the
Semiconductor Laboratory in Mohali and a program of Rs76,000 crore for the
development of sustainable semiconductor and display manufacturing in the country.
‘The government of India have to make concert efforts for semiconductor manufacturing
in India for internal security and growth of electronic manufacturing in India.
OM Gupta
hitps:/timestech jnvmade-r-indi-semiconductor-2late-approach-atrightsime!