Semicon India 2023 Gives Shape to India&#8217;s Chip Ambitions
During the Semicon India held from July 28 to 30 in Gandhinagar, Gujarat, Prime Minister Narendra Modi pitched India as a viable chip-making hub to global investors. “We are becoming a solid conductor for the semiconductor industry,” said Modi. The three-day long event brought together key stakeholders in the semiconductor industry, including government officials, industry leaders, researchers, and technology experts to discuss and showcase the advancements and potential of the semiconductor sector in India. Modi and the union ministers put forth intriguing perspectives on India’s semiconductor ambitions. However, even though the government has been pushing hard to bring India on the semiconductor stage, the efforts haven’t yielded any major results. Will Semicon India 2023 change that? Key announcements at Semicon India 2023 Promising announcements were made at the event, which could give India’s desire to become a semiconductor hub a kickstart. Micron, a US-based chipmaker revealed its plan to invest USD 2.7 billion to develop a new assembly and test facility in Gujarat, which will serve as the centre for the manufacturing of DRAM and NAND products. The hub will cater to both domestic and international markets and will directly create 5,000 jobs and over 15,000 community jobs in the coming years. Another US-based chipmaker, Advanced Micro Devices (AMD), plans to invest USD 400 million over the next five years and set up its biggest R&D facility in Bengaluru, Karnataka. The centre is expected to come up by the end of this year, and could potentially employ 3,000 engineers. Vedanta chairman Anil Agarwal revealed that his company is in talks with a ‘world-class’ technology partner and said Vedanta remains committed to establishing a fab in the country. Similarly, Young Liu, the chairman of Taiwanese manufacturing giant Foxconn, commenting on Modi’s statement, expressed his belief in India being a ‘trusted and reliable partner’, advocating for collaborative efforts between the two nations. Reports from earlier this month suggested that Foxconn is partnering with Taiwan Semiconductor Manufacturing Company (TSMC) to establish a fab in India. Interestingly, Vedanta and Foxconn had previously collaborated to establish a semiconductor manufacturing unit in Gujarat. However, they eventually decided to part ways. Entry of semiconductor component players could increase While the primary goal is to establish a fab, setting up testing and packaging units in the country would also be a positive step forward. Semiconductor packaging holds the potential to become a pivotal moment in India’s chip-making and fabrication efforts, and the country possesses the skilled talent to emerge as a prominent manufacturing centre, Prabu Raja, president of Semiconductor Products Group (SPG) at Applied Materials, told ET in an interview. Micron’s decision to set up a packaging unit in India could lead to five more players entering India, which are part of the packaging ecosystem. Reportedly, Simmtech, a supplier of printed circuit boards, and Air Liquide, a provider of high-purity industrial gases for chip manufacturing, are in discussions with the government to commence operations in India. Furthermore, Disco, one of the world’s leading makers of tools for cutting and grinding silicon wafers, is reportedly also looking to establish a base in the country. The Idaho-headquartered firm is also not the only player looking to set up a packaging unit in India. Last year, Tata Sons chairman Natarajan Chandrasekaran confirmed the conglomerate’s entry into the semiconductor space with the establishment of Tata Electronics. The conglomerate is also expected to set up a test and packaging unit, however, the ultimate goal, nonetheless, is to set up a fab. India still does not have a fab Despite some promising announcements at Semicon India 2023, Vedanta, despite facing numerous setbacks, still remains the most likely candidate to set up a fab in the country with Agarwal claiming his company could launch the first ‘made-in-India’ chip in 2.5 years. Micron, despite its USD 825 million investment plan, is setting up a semiconductor testing and packaging unit, and not a fab. Meanwhile, even though Foxconn continues to show interest in establishing a fab in India, the company’s dubious reputation makes it unlikely for TSMC to be a potential partner. Recent reports suggest that NXP Semiconductors, a division of Royal Philips NV, has also shown interest in setting up a fab in the country, given they find the right ecosystem. Previously, along with Vedanta-Foxconn JV, IGSS Ventures, and ISMC also submitted proposals to set up semiconductor fabs. “IGSS Ventures was not able to show a proper technology licence for 28 nm chips and the Indian Semiconductor Mission (ISM) asked them to get a strong Indian business partner. Even though it’s nowhere written in the policy, it kind of makes sense for India to ask for a strong Indian business partner,” Arun Mampazhy, semiconductor analyst, earlier told AIM. When it comes to ISMC, which is a joint venture between United Arab Emirates-based investment firm Next Orbit Ventures and Israel-based Tower Semiconductor, the government is waiting for Intel’s acquisition of Tower Semiconductor to complete and to see whether Intel will approve the technology transfer. Given that the agreement expires on August 15th, 2023, it’s still not known whether Intel will seek an extension or the deal will be called off entirely. Intel CEO Pat Gelsinger chose not to comment on the same during the company’s quarterly earnings call. Besides the three, PSMC (Powerchip Semiconductor Manufacturing Corp), earlier showed interest in setting up a fab in India. Chairman Huang Chongren stated that Taiwan’s third-largest foundry is ready to sign a cooperation agreement with the Indian government. However, nothing much happened after that. AIM wrote to PSMC earlier inquiring about the same, but, they have not responded so far. Chandrasekhar, in an interview last month, stated that the government will soon announce a 40 nm semiconductor fabrication unit under the modified semiconductor investment scheme. Whether it’s Vedanta or anyone else is not known, however, Vendata-Foxconn JV’s initial plan was to set up a 40 nm fab. Furthermore, IT Minister Ashwini Vaishnaw told Mint that India should receive two more fab applications in the coming months.
At the event, Vedanta chairman Anil Agarwal revealed that his company is in talks with a ‘world-class’ technology partner
During the recent Semicon India event held in Gandhinagar, PM Narendra Modi pitched India as a viable chip-making hub to global investors
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