India is heading towards a robust economy and the country’s semiconductor consumption is expected to exceed $110 billion by 2030, Prime Minister Narendra Modi said on Friday, while listing six main reasons why India is the next big destination for semiconductor technology.
He pointed out that the country was building digital infrastructure to connect more than 1.3 billion citizens, bring 600,000 villages onto the broadband network and invest heavily in improving skills and boosting manufacturing.
During his virtual address at the inaugural session of the Semicon India-2022 conference, Modi called on the industry to make India one of the key partners in global semiconductor supply chains and to work in this direction based on the principle of “hi-tech, high quality and high reliability”.
“Our collective goal is to make India one of the key partners in global semiconductor supply chains,” he said. “India’s own consumption of semiconductors is expected to exceed $80 billion by 2026 and $110 billion by 2030.”
The Union Government’s Semicon India program, set up to build the semiconductor and display ecosystem in the country, has attracted corporate interest with proposals for more than ₹1.53 lakh crore received in the first round which closed on February 15. Five semiconductor and display manufacturing proposals were received with a total investment of nearly $20.5 billion or ₹153,750 crores, the Ministry of Electronics and Information Technology (MeitY) said in a statement.
States such as Karnataka have a large presence of large semiconductor companies and are working on sectoral policy to take advantage of this opportunity.
India approved a semiconductor policy in December last year to encourage a national ecosystem for semiconductors and display manufacturing – in line with the government’s ambition to create an electronics industry of 300 billion over the next six years, and at a time when electronics supply chains around the world have been hit by a shortage of semiconductors.
Outlining six reasons for India to become an attractive investment destination for semiconductor technologies, Modi said, “We are building the digital infrastructure to connect over 1.3 billion Indians and UPI is the most efficient payment infrastructure in the world today.
Second, India is paving the way for the country to lead the next “technological revolution”, Modi said. Efforts are underway to try to connect 600,000 villages to broadband and also invest in capacity development in 5G, clean energy technologies and the Internet of Things (IoT), he added.
The Prime Minister also said that India is heading for robust economic growth with the fastest growing startup ecosystem in the world.
Fourth, India has undertaken far-reaching reforms to improve the ease of doing business in the country. Modi noted that various reform measures taken by the government, such as the abolition of more than 25,000 compliances, a push towards automatic license renewal, transparency and speed of the regulatory framework through digitalization, and one the most favorable tax structures in the world.
The Prime Minister also pointed out that the country is investing heavily in qualifying and training young Indians for the needs of the 21st century. “We have an exceptional pool of semiconductor design talent that represents up to 20% of semiconductor design engineers worldwide… Almost all of the top 25 semiconductor design companies have their centers design or research and development in our country…” he said.
Finally, he pointed out that the government has taken several steps to transform India’s manufacturing sector. “At a time when humanity was battling a once-in-a-century pandemic, India was not only improving the health of our people, but also the health of our economy,” he said. .
The previous government was like a “doorstep” while the government’s role should be like “and a door”, he added, referring to the logic gates that form one of the foundations of electronics.
“Before, industries were ready to do their job, but the government was like a ‘door step’. When an entry enters the ‘no gate’, it is voided,” he said. “But, we understand that the government has to be like the ‘and the door’. While industry is working hard, government must work even harder.
“It (the semiconductor industry) is really huge and that’s why the Indian government is ready to invest ₹70,000 crore to start. During the Covid-19 pandemic there have been supply chain issues and there is a shortage affecting many other industries. We import electronic equipment worth $400 billion, which exceeds our oil imports. It is therefore clearly necessary to have our own national semiconductor industry. The importance is very clear,” S Gopalakrishnan (Kris), co-founder of Infosys and technology investor at Axilor, told HT.