Our Research Director, Tarun Pathak, in a recent interview with NDTV Profit gave his key takeaways on India’s push toward becoming a player in the global semiconductor industry.
The Interview
Key Takeaways
- Strategic Importance: Semiconductors are crucial to all modern electronics, from phones to lighting systems, and India is recognizing the significance of this industry, especially post-COVID when the world faced a global chip shortage.
- Government Initiatives: The Indian government is heavily supporting semiconductor manufacturing, and efforts are being led by Prime Minister Modi and other top ministers to make India a global hub for chip manufacturing. This includes partnerships with foreign companies like Micron and Tata.
- Growing Opportunities: With the semiconductor industry’s global market dominated by a few players, India is entering the sector with a comprehensive approach. There’s a focus on creating infrastructure, design expertise, and manufacturing capabilities, backed by substantial investments and state government collaboration.
- Capital Intensive but Promising: While semiconductor production is extremely expensive, with long-term returns on investment, India is poised to leverage its demographic advantage, with a large number of engineers and an aspirational workforce. The government’s frugal engineering mindset is seen as a strong foundation for success.
- Strategic Alliances: India is forming bilateral agreements and partnerships, such as those with Singapore and the U.S., to bridge its technology gap and gain access to the global semiconductor supply chain.
- Phased Growth Approach: Instead of directly competing with giants like Taiwan, India is focusing on mature nodes and older process technologies, starting with 28-110 nanometer semiconductors, which are widely used in consumer electronics, automotive, and defense sectors.
- Excitement and Optimism: Industry leaders are optimistic about India’s progress, with key players like Micron, Tata, and others investing in semiconductor facilities. The Indian workforce and government commitment are viewed as strong assets for long-term success.
Watch the full video here