As India aims to become a developed nation by 2047, it is imperative for the country to establish a self-sufficient semiconductor supply chain
Semiconductors have become a crucial component of the contemporary economy, serving as a backbone for technological advancement and industrial growth. For a nation aiming to elevate its economic status and achieve developed country status by 2047, establishing a self-sufficient semiconductor supply chain is imperative.

To transform India into a prominent semiconductor production hub by the end of this decade, the government has initiated a comprehensive strategy, bolstered by the proactive support of Prime Minister Narendra Modi.

The development of domestic semiconductor manufacturing capabilities is anticipated to significantly enhance the Indian economy and position the country among the ranks of advanced nations.

Fostering innovation and self-reliance

 In pursuit of this objective, India launched the India Semiconductor Mission in 2021, which plays a pivotal role in organizing international semiconductor conferences that attract leading global corporations in the industry.

During the inauguration of this year's Semicon India 2024, the Prime Minister emphasized that the semiconductor sector in India is on the brink of a transformative revolution, with significant innovations poised to reshape the landscape of the industry.
The theme for this year's event, “Shaping the Semiconductor Future,” underscored India's strategic vision to emerge as a global leader in semiconductor design, manufacturing, and technological development.

This initiative not only aims to bolster India's position in the global semiconductor market but also seeks to foster innovation and self-reliance within the country.
The utilization of invisible semiconductors spans a wide array of products, including electronics, mobile devices, automotive technology, defence systems, aerospace applications, and nuclear equipment.

As a significant participant in these advanced and sensitive industries, India recognizes the necessity of establishing a domestic semiconductor supply chain to ensure economic stability and growth.

Notably, leading industrial powers such as the United States and various European nations, which currently rely on suppliers mostly from China and Taiwan, are increasingly looking to India as a viable alternative for their semiconductor needs.
This shift is driven by a shared understanding among these nations, including India, that their economies are vulnerable to potential coercion or disruptions in supply.

Consequently, the Indian leadership has prioritized the development of indigenous semiconductor manufacturing and research capabilities, which is essential for maintaining its status as the fifth-largest economy and its ambition to become the third-largest globally.

Creating conducive ecosystem 

In recent years, India has actively sought to attract prominent global chip manufacturers by offering substantial financial incentives and creating a conducive industrial ecosystem for the operation of sophisticated semiconductor production facilities.

The Indian government has unveiled appealing proposals aimed at enticing international semiconductor firms, including a financial subsidy plan amounting to Rs 76,000 crores. Following some initial reluctance, leading semiconductor companies have now committed to establishing their second production sites in India.

Furthermore, the government is capitalizing on its strategic partnerships with advanced nations such as the United States, Singapore, and Japan to bolster its semiconductor industry initiatives.

Importantly, the QUAD alliance, comprising India, the United States, Japan, and Australia, has also expressed its dedication to supporting India's emergence as a key player in the global semiconductor supply chain.

Ambitious investment strategy  

 SEMICON 24 has highlighted the significant progress that is steering India towards a future characterized by innovation and self-sufficiency.

With the government's strong commitment to fostering new semiconductor initiatives, projections indicate that India could attract investments exceeding US$30 billion in semiconductor projects within the next three to four years.

The successful implementation of this ambitious investment strategy has the potential to transform the landscape of India's manufacturing sector.

 To date, the Indian government has approved six major investment proposals, amounting to over Rs 2.36 lakh crores, which will serve as a catalyst for this transformation.

This initiative not only positions India among a select group of nations in the semiconductor arena but also presents significant opportunities for the country's highly skilled workforce, which will be essential for the semiconductor industry.

Currently, India contributes 20 percent of the global skilled labour force in semiconductor design, indicating a robust foundation for expanding skilled manpower in semiconductor manufacturing and assembly.
To address the anticipated talent gap, SEMI, the global semiconductor industry association, has introduced a workforce development program in India aimed at mitigating the global talent shortage in this sector. It is projected that over 300,000 skilled professionals will be necessary to fulfil industry requirements in the coming years.

As the demand for semiconductor chip manufacturing facilities surges, particularly with the rise of Artificial Intelligence, it is estimated that nearly 150 new fabrication plants will be needed to achieve the industry target of over US$ 1 trillion by 2030. Through SEMICON 24, the government aims to secure a substantial share of this burgeoning market.

Conclusion

During the Semicon-India event, the Prime Minister revealed that India is actively formulating a strategy to cultivate a workforce of over 85,000 technicians, engineers, and research and development specialists, all of whom will be essential for the semiconductor and related sectors.

To facilitate the creation of advanced and next-generation chips, the government is in the process of establishing a semiconductor research centre at the Indian Institute of Space Science, in partnership with the Indian Institute of Technology.

The government's commitment to fostering domestic capabilities in semiconductor chip manufacturing and related industries is designed to satisfy both national and global demands, positioning India as a significant player in the semiconductor arena.

This initiative is crucial, as India, having previously missed opportunities during the industrial revolution, cannot afford to overlook the importance of the semiconductor industry.

***The writer is a senior journalist and strategic affairs analyst; views expressed here are his own