Semiconductor Industries in India
Published on : Friday 15-09-2023
India is on an ambitious journey to become a global semiconductor manufacturing hub, says Darshana Thakkar.
In the last two decades, digital technologies have transformed the life of every human and business practice. The driving factor is technological advancement. Digital tools and their advanced application transformed electronic manufacturing industries.
The core ingredient of the electronic sector is semiconductor material and the chips of its products. Over the years, a few chip manufacturers from countries like America, Japan, Korea, Taiwan, and China pioneered the Semicon sector.
In recent years, specifically in the post-Covid era, the world has wanted to diversify the global supply chain of semiconductor chipsets. With the emergence of technologies like Industrie 4.0, IoT, AI, and ML, the demand for semiconducting products has increased drastically. India, a young country with a higher number of citizens using digital tools, no longer wants to be dependent on the world.
India, one of the biggest markets and fastest-growing economies, is a promising player in the global semiconductor industry. Even the world is now looking at India becoming a global semicon product supplier.
To fulfill the aspiration to make India a global hub for Electronics manufacturing, the government of India has launched the India Semiconductor Mission (ISM), a specialised and independent Business Division within the Digital India Corporation that aims to build a vibrant semiconductor and display ecosystem to enable India's emergence as a global hub for electronics manufacturing and design. Led by global experts in the Semiconductor and demonstration ecosystem, the mission aims to serve as a focal point for the comprehensive, coherent, efficient, and smooth deployment of the Program for Development of Semiconductor and Display Ecosystem in consultation with the Government ministries/departments/agencies, industry, and academia.
The India Semicon Mission
Semicon India Program aims to provide attractive incentive support to companies/consortia that are engaged in Silicon Semiconductor Fabs, Display Fabs, Compound Semiconductors/Silicon Photonics/Sensors (including MEMS), Fabs, Semiconductor Packaging (ATMP/OSAT), and Semiconductor Design.
The program will give Semiconductor and display manufacturing impetus by facilitating capital support and technological collaborations.
Under this mission, the Indian government is organising specialised events and conferences.
The vision is to position India on the world's Semiconductor map and to build a vibrant semiconductor innovation and manufacturing ecosystem.
1. Semicon India Conference 2022 at Bengaluru, Karnataka.
2. Semicon India Conference 2023 at Gandhinagar, Gujarat.
Key objectives of the ISM
Formulate a comprehensive long-term strategy for developing semiconductors & display manufacturing facilities and semiconductor design ecosystem in the country in consultation with Government ministries/departments/agencies, industry, and academia.
ii. Supply Chain
Facilitation the adoption of trusted electronics through secure semiconductors and display supply chain, including raw materials, specialty chemicals, gases, and manufacturing equipment.
iii. Design & Startup
To enable a multi-fold growth of the Indian semiconductor design industry by providing requisite support in the form of Electronic Design Automation (EDA) tools, foundry services, and other suitable mechanisms for early-stage start-ups.
iv. Intellectual Property
To promote indigenous Intellectual Property (IP) generation and encourage, enable, and incentivise the Transfer of Technologies (ToT).
To enable collaborations and partnership programs with national and international agencies, industries, and institutions for catalysing collaborative research, commercialisation, and skill development.
To achieve the objective of the ISM, the government has launched various schemes to promote the development of chip manufacturing within India to become not only self-dependent but also a global supplier.
i. Semiconductor Fab
The Scheme for setting up Semiconductor Fabs in India shall extend fiscal support of up to 50% of project cost on a pari-passu basis to the approved applicants.
ii. Display Fabs
The Scheme for setting up Display Fabs in India shall extend fiscal support of up to 50% of project cost on a pari-passu basis to the approved applicants.
iii. Compound Semiconductor
The Scheme for setting up of Compound Semiconductors/Silicon Photonics/Sensors (including MEMS) Fabs/Discrete Semiconductors Fab and Semiconductor ATMP/OSAT facilities in India shall extend fiscal support of 50% of capital expenditure to Compound Semiconductors/Silicon Photonics/Sensors (including MEMS) Fabs and Semiconductor Packaging (ATMP/OSAT) units.
iv. Design Linked Incentive (DLI)
The Design Linked Incentive (DLI) Scheme aims to offer financial incentives as well as design infrastructure support across various stages of development and deployment of semiconductor design(s) for Integrated Circuits (ICs), Chipsets, Systems on Chips (SoCs), Systems & IP Cores and Semiconductor linked design(s) over a period of 5 years.
India's semiconductor industry is on the brink of a transformative era fueled by ambitious visions.
During the inauguration of Semicon 2023 at Gandhinagar, Gujarat, India's honourable PM Narendra Modi announced the creation of a talent pool of over 100,000 skilled chip design engineers by 2028.
Opportunities in India’s semiconductor industry
India's semiconductor industry is booming with opportunities.
1. The global demand for semiconductors in various sectors, such as electronics, telecommunications, automotive, and healthcare, presents a lucrative opportunity for India to expand its market reach and global presence.
2. The Indian government's proactive initiatives, the ‘Make in India’ campaign, and favorable policies, have created an enabling environment for semiconductor manufacturing and research, attracting foreign investment and fostering indigenous innovation.
3. With the vision to develop a talent pool of over 100,000 skilled chip design engineers by 2028, India has immense potential to become a semiconductor design and innovation hub, driving technological advancements and job creation.
4. Collaboration between academia, research institutions, and industry players will enhance knowledge-sharing research capabilities and foster innovation, strengthening India's semiconductor ecosystem.
Let's work together to make India a leader in the semiconductor industry.
Challenges in India's semiconductor industry
1. Talent shortage is the primary obstacle. The scarcity of skilled chip design engineers is a major challenge hindering the industry's growth. Bridging this gap requires targeted efforts in training and upskilling to meet the demands of a rapidly evolving sector.
2. Infrastructure Development demands high investment, making it difficult for small enterprises and start-ups. : Establishing world-class semiconductor fabrication facilities and research centres requires substantial infrastructure and technology investment.
3. Intellectual Property (IP) Protection is another big challenge. Ensuring robust IP protection and adhering to global standards is crucial for building trust and attracting investments from international semiconductor companies.
4. Rapid Technological Advancements keep the stakeholders and the whole ecosystem on their toes. Swift technological advancements characterize the semiconductor industry. Staying at the forefront of innovation demands continuous learning and adaptability.
A new initiative by the Indian government to foster the Semicon Ecosystem:
1. Technology firms will be given 50 percent financial assistance for setting up semiconductor manufacturing facilities.
2. For the semiconductor ecosystem, the government plans to change the engineering curriculum.
3. 300 colleges are identified in the country for starting courses on semiconductor design.
4. The government has recently approved the 'National Quantum Mission' and will introduce the Nation Research Foundation Bill in Parliament.
5. The National Quantum Mission aims to seed, nurture, and scale up scientific and industrial research and development and create a vibrant and innovative ecosystem in quantum technology.
6. The country has announced different types of tax relief for a new manufacturing industry. At present, India is among the countries with the lowest corporate tax. And it made the taxation process faceless.
India is taking a big step forward in the semiconductor industry. The government has announced a new initiative to foster the semiconductor ecosystem.
Top 10 semiconductor manufacturing companies in India
1. Saankhya Labs, Bengaluru
2. ASM Technologies, Bengaluru
3. Broadcom Inc, Bengaluru
4. Chiplogic Technologies, Bengaluru
5. CDIL, New Delhi
6. MosChip Semiconductor Technologies, Hyderabad
7. Einfochips, Ahmedabad
8. Tata Elxsi, Bengaluru
9. Semiconductor Laboratory, Mohali, and
10. NXP Semiconductors, Bengaluru.
India, one of the fastest emerging economies, is on its ambitious journey to become a global semiconductor manufacturing hub. With the vast talent pool, remarkable government support, an increasing number of chip design start-ups, and the involvement of foreign players, India continues to promote ‘AtmaNirbharbharat’, a self-reliance campaign to reduce its semiconductor import burden and strengthen domestic manufacturing capabilities.
The Design Linked Incentive (DLI), Chips to Start-ups (C2S) and Scheme for Promotion of Electronic Components and Semiconductors (SPECS) are also making a positive impact on India's semiconductor industry.
Moreover, the Government of India has launched several skill development programs like SANKALP, Skill Acquisition and Knowledge Awareness for Livelihood Promotion, which aims to train around 10 million people in various sectors, including ESDM, and PMKVY, Pradhan Mantri Kaushal Vikash Yojana, under NSDC.
India's semiconductor industry employs over 55,000 design engineers responsible for overseeing diverse engineering functions. With the efficient and accessible availability of the PLI scheme, the Government of India aims to promote value-added chip-design research and attract foreign players to establish their semiconductor design and development facilities in India.
Darshana Thakkar is MSME Transformation Specialist and Founder, Transformation – The Strategy Hub. An Electrical Engineer followed by MBA – Operations with hardcore industry experience in managing business operations, Darshana is an expert in transformation of businesses that helps them achieve growth with speed and scale. She has invested 27 years in transforming Micro and Small Enterprises. Her rich experience in resolving pain areas and the MSME/SME industry's real-life problems are helping the organisation for quick results.
Darshana has helped many MSMEs to increase profitability & achieve sustainable growth. She is keen on the growth of Indian Startups, providing mentoring and hand-holding support to startups to make them succeed quickly.
She is very passionate about supporting women in pursuing their career and life goals. She is actively working for women's entrepreneurship and leadership development.
· Founder and CEO of Transformation
· Certified Women Director by IICA, Ministry of Corporate Affairs, Government of India
· Empanel and recognised Startup mentor and Trainer by CED, Government of Gujarat
· Registered and Verified Business Advisor – Tata Nexarc, Tata Business HUB, Mumbai, and
· Chairperson: MSME Support & PRO at Makarpura GIDC Association, Vadodara.
MSME Transformation and Strategic Advisor – MSME Business Forum India, Darshana has received various accolades:
· Winner of Gujarat Women's leader award 2022 by CMO Asia
· Winner of Influential Women leader in business by Insight Success 2022
· Recognised as India's most trusted consulting company by Insight Success 2022
· Felicitated by Mentor my board in the gracious presence of Honourable FM Mrs. Nirmala Sitaraman during Women Director's conclave – 2022
· Felicitated by the president of Makarpura GIDC Association during the Suvarna Jayanti Mahotsav on 17th December 2022 for her excellent contribution in supporting MSME and startup Businesses.
Apart from this, she is an author and publishes her blog, article, and case study related to the industry. Email: [email protected]