The India Cellular & Electronics Association (ICEA) has urged the Indian government to intensify its efforts in establishing the country as a key player in the global semiconductor supply chain.
According to the ICEA, fostering investment in semiconductor design and creation of intellectual property among large Indian engineering corporations is essential for this ambition. The industry body has also recommended that the government increase funding for the semiconductor design ecosystem, proposing the establishment of a low-cost banking system or a separate capital market specifically for technology investments.
The ICEA stressed the strategic importance of semiconductors, suggesting the sector be officially designated as such to facilitate more robust governmental support and investment. In a bid to further boost the nascent sector, the association advised expanding the current chip startups program, which offers various incentives, to include more firms and enhance the ecosystem's overall capability and competitiveness.
A critical component for the success of India's fabless semiconductor companies is the ability to access fabrication facilities (Fabs) at reasonable costs and timelines, an area where many firms reportedly struggle. The ICEA pointed to lessons that could be learned from nations like China, which has successfully developed a supportive environment for its semiconductor industry.
The government's commitment to transforming India into a semiconductor-producing nation was marked by a significant development in December 2021 when it approved a USD 10 billion incentive package for companies willing to establish chip manufacturing and packaging units in the country.
Since the announcement, major corporations including US-based Micron, the Tata Group, and CG Power Group have made strides under this program. Micron is in the process of setting up a chip packaging facility in Sanand, Gujarat.
Similarly, the Tata Group is establishing a chip manufacturing facility in Dholera, Gujarat, and a packaging unit in Morigaon, Assam, with CG Power also setting up a packaging unit in Sanand.
