Introduction
Most new technologies, from computers to guns, depend on semiconductors. So it isn’t surprising that almost every country is trying to improve its semiconductor production and make sure there are enough sources. India is no different. The semiconductor industry in India plays a crucial role in driving economic growth and innovation. It has reshaped the economic landscape.
A. Brief overview of the semiconductor industry
The semiconductor industry in India is an important part of electronic products. Such products make progress possible in many areas, such as healthcare, transportation, messaging, computing, energy, and more.
B. Significance in technological advancements and global economy
Semiconductors are thus central to modern technology and are important in many fields, such as healthcare, military, defense, and cars. The power developments paved the way for a more advanced and connected world, which in turn affected economic growth.
C. Teaser on India’s role in this dynamic sector
In the past few years, there has been a big increase in the demand for semiconductors in India. This is due to things like the widespread use of 5G technology, the rise in popularity of cryptocurrency mining, which needs more processing units, and the government’s ongoing efforts to make everything digital.
2. Historical context
The Indian semiconductor business has been around for a long time. It all started in Bangalore in the early 1960s when the Indian government set up the Semiconductor Complex India Limited (SCL). SCL was India’s first company to make semiconductors, and it was a major force in the growth of the industry.
A. A glimpse into the early stages of the semiconductor industry in India
During the 1980s, the semiconductor industry in India began to grow very quickly. This happened because of several things, such as the government’s backing for the industry and the growth of the home technology market. It had become a big producer of semiconductors by the end of the decade.
B. Key milestones and challenges faced during initial development
For India to get started in the semiconductor business, Semiconductor Complex Limited (SCL) had to be set up in Mohali in the early 1980s. This was the first time that semiconductors were made in the country. But the business only really took off a few years later. This was because of problems with facilities, a need for more skilled workers, and government backing.
3. Current landscape
The semiconductor industry in India is on the rise right now, thanks to smart government policies, foreign relationships, and a focus on developing talent. India will become a dependable and important player in the world electronics business thanks to these coordinated efforts.
A. Statistics and figures highlight the current status of the semiconductor industry in India
According to a new study, India’s semiconductor business grew significantly from US$34.3 billion in 2023 to US$100.2 billion by 2032, with a remarkable compound annual growth rate (CAGR) of 20.1% during the period.
B. Key players and their contributions
Tata Electronics, Bharat Electronics Limited, and Intel India are some of the biggest companies in India’s semiconductor business. To keep up with growing demand and drive innovation, these companies have put money into R&D, production sites, and partnerships.
C. Major areas of focus and specialization
India has a large group of semiconductor design engineers, and work is being done to fix problems like low wages and a lack of qualified workers. People in the country are very good at designing system-on-semiconductors (SoCs), building embedded systems, and making semiconductors.
4. Government initiatives
Due to a lack of semiconductors around the world, the semiconductor industry in India is still very young. However, India has been working hard over the last few years to get a piece of this market.
A. Discussion on government policies and initiatives supporting the semiconductor sector
Beginning in 2021, the government introduced a number of programs aimed at luring significant investments for the establishment of semiconductors, compound semiconductors, displays, and design-linked incentives in India. Under these programs, qualified applicants in the semiconductor industry could apply for both fiscal and non-fiscal incentives through the Semicon India Program.
B. Incentives and measures to promote indigenous manufacturing
The government can cover up to 50% of the project cost if facilities for making silicon-based semiconductors are set up in different technology nodes in India. The state government or any of its departments or local groups may be able to give more money.
5. Collaborations and partnerships
India cleared three plans for semiconductor plants in March in order to improve its ability to make semiconductors. The projected cost of these projects is 1.26 lakh crore, and they are expected to make India’s technology production sector a lot stronger.
A. Explore international collaborations and partnerships fostering growth
In Dholera, Gujarat, India, Tata Electronics and PSMC of Taiwan will construct the country’s first semiconductor fabrication factory (fab). A semiconductor unit will also be built by Tata Semiconductor Assembly and Test Pvt Ltd (TSAT) in Morigaon, Assam. CG Power, Renesas Electronics Corp. of Japan, and Stars Microelectronics of Thailand will all work together to build another semiconductor plant in Sanand, Gujarat.
B. Case studies of successful joint ventures
The Vedanta Group in India and the Foxconn Group in Taiwan work together in VFSL, with a 67:33 split. As per the reports, Foxconn is talking to well-known Indian businesses about forming relationships to help it reach its goals of making the semiconductor industry in India.
6. Innovation and research
Indian businesses are putting more and more effort into new ideas and research and development in order to fight in the global semiconductor market. This focus on technical progress is what is making it possible for more companies to develop and make semiconductors in their own countries.
A. Highlighting innovative projects and research in the Indian semiconductor domain
India has been trying for decades to find its spot in the semiconductor industry. Its dream is now coming true after the government approved the first commercial semiconductor manufacturing unit (fab) and started two more projects that will test and package semiconductors.
B. The role of academic institutions and research centres
It is very important to work with academic institutions and businesses to create creative hubs and centres of excellence for semiconductor research and teaching. A planned R&D building under the Indian Semiconductor Research Center (ISRC), which has been in the news, will lead to great things in the future.
7. Challenges and opportunities
For strategic partners and technology providers, here is a high-level look at the most important things to think about before setting up a semiconductor manufacturing or assembly and testing unit in India.
A. Analysing the challenges faced by the semiconductor industry in India
Suppose a person wants to get money from the Government of India’s (GoI) incentive programs. In that case, they have to show that they can own or have access to relevant production-grade technology through licensing. And plan how they will get advanced node technologies in the future through licensing or development.
It would help if you also showed that you have off-take promises of up to 100% of the expected profits, along with legally binding paperwork signed by possible buyers to back up your claims.
B. Opportunities for growth and overcoming obstacles
India has more people wanting to buy electronics and cars, which has raised the demand for the semiconductor industry in India. India’s car business intends to double its size to Rs 15 lakh crores by the end of 2024, according to the PIB Report 2023.
8. Global impact
The United States came up with semiconductors and is still the world leader in cutting-edge study, design, and production. With $264 billion in sales in 2023, the US semiconductor business had half of the world’s market share, making it the world winner.
A. Discussing India’s influence on the global semiconductor market
India wants to be the centre of design, production, and technology creation for semiconductors around the world. However, the lack of computer semiconductors has shown that the supply chain is weak and made it clear that India needs to make more things than the United States.
B. How the Indian industry contributes to the global supply chain
In the 1980s, NI and other companies were the first to put money into the semiconductor business as a whole. In the beginning, it was mostly about software since India was known for having good software skills. The main topics were software service design and integrated services.
And that’s when a lot of semiconductor companies set up design centres. Then, it began in 2010, and the attention shifted to design research and development for manufacturing. That’s how development happened. These days, people are more interested in making things and fabricating them. To be self-sufficient, the semiconductor’s goal is to make production possible.
9. Future outlook
Studies show that the semiconductor industry in the Indian market will grow very quickly, possibly hitting $60 billion or more by 2026 and $100 billion or more by 2030, which would be 10% of the world’s total consumption. However, a lot of growth opportunities come from new semiconductor designs. India’s future success will depend on how well it can switch from manufacturing-focused innovation to design-focused innovation, which will help build a strong community of semiconductor design talent.
A. Predictions for the future of the semiconductor industry in India
The market of the semiconductor industry in India grew at a remarkable CAGR of 20.1% between 2023 and 2032, according to a new study. The market was valued at $34.3 billion in 2023 and is predicted to reach $100.2 billion by 2032.
B. Emerging technologies and potential areas for expansion
Neuromorphic computing, in line with AI principles, and quantum computing, which may play a crucial role in the Internet of Things, are two areas where the semiconductor industry is set to see substantial growth.
10. Conclusion
There is exciting new potential for business and investment in India’s semiconductor sector, which is seeing rapid expansion. Approximately 1 million new employment will be created in India’s semiconductor sector in the next four to five years. The semiconductor industry in India can generate high-skilled jobs and contribute to economic development, as shown by this prediction.
Find out how to keep up with the latest news in the fast-paced semiconductor industry in India. You’ll be ready to face the challenges and take advantage of the chances this constantly changing field has to offer if you focus on your investing strategies. As you start your exciting journey in the world of electronics and investing, stay interested and be open to new developments.
FAQs
Q. Who is the largest producer of semiconductors in India?
The semiconductor industry in India business is very important to the economy because it helps the tech sector grow. HCL Technologies is the largest producer of semiconductors in India.
Q. Is there a semiconductor industry in India?
With the addition of the three new units, India now has four factories that make semiconductors. Micron, a well-known American semiconductor company, has promised to spend up to $825 million to build a centre in India where computer semiconductors can be assembled and tested.
Q. Which are the top 5 semiconductor companies in India?
The top five semiconductor companies in India are HCL Technologies Ltd, Vedanta Ltd, Dixon Technologies (India) Ltd, Tata Elxsi Ltd, and Mossemiconductor Technologies Ltd.
Q. Which company will build semiconductors in India?
In a joint venture of Rs 9,100 billion, Tata Electronics Private Limited (TEPL) and Powersemiconductor Semiconductor Manufacturing Corp (PSMC) of Taiwan will build a semiconductor factory in Dholera, Gujarat.
