With technological advancements including electric vehicles, 5G, and artificial intelligence, the semiconductor sector is expected to grow significantly.
A semiconductor is a material capable of controlling electrical currents, thus making an essential component of majority of modern electronic appliances. As per recent reports, Elon Musk-owned Tesla has partnered with Tata Electronics to develop its presence in India. This deal comes amidst Elon Musk’s scheduled visit to India to meet Prime Minister Narendra Modi this month. As part of strategic partnership, Tata Electronics will be supporting Tesla in its semiconductor chip global operations. According to the report: “Executed discreetly a few months ago, this agreement is noteworthy as it positions Tata Electronics as a dependable supplier for prominent global clients aiming to establish a crucial segment of their semiconductor value chain in India.”
In this article, we will discuss about opportunities in semiconductor technology in India.
Globally, semiconductor industry is expected to touch a trillion-dollar industry by end of this decade. According to Semiconductor Industry Association (SIA): “The global semiconductor industry sales totaled $46.2 billion during the month of February 2024, an increase of 16.3% compared to the February 2023 total of $39.7 billion, but a decrease of 3.1% from the January 2024 total of $47.6 billion.”
In 2023, the semiconductor sector in India had worth of USD 34.3 billion which is expected to touch USD 100.2 billion by 2032. As semiconductors are used in day-to-day applications like smartphone, cars, computers, with rising population, the demand of semiconductor is expected to grow faster.
The semiconductor sector in India is currently relying on imports for semiconductors from China, Taiwan, Vietnam, and Korea. As the demad is increasing, India is planning to develop multiple semiconductor manufacturing units.
The Ministry of Electronics and Information Technology (MeitY) has introduced the India Semiconductor Mission (ISM) worth of $10 billion USD. This includes support for manufacturing and the Design Linked Incentive (DLI) scheme to semiconductor startups. Moreover, the ‘Make in India’ initiative along with Production Linked Incentive (PLI) scheme offer financial support to establish semiconductor manufacturing units in India.
In the last month, Prime Minister Narendra Modi laid the foundation stone of three semiconductor projects worth ₹1.25 lakh. He also mentioned: “13th March 2024 - a special day in India's efforts to become a hub for semiconductors.”
Under the Design-Linked Incentive (DLI) Scheme, two Karnataka-based semiconductor firms named Saankhya Labs, a subsidiary of Tejas Network, and Sensesemi Technologies received financial support to develop semiconductors.
Saankhya Labs provides “wireless communication and semiconductor solutions” which are specialized in developing products and solutions for broadband, satellite, along with broadcast applications in areas like “5G NR, Direct to Mobile (D2M) Broadcast, rural broadband connectivity, satellite communication modems for IoT applications, and multi-standard DTV modulators and demodulators,” as mentioned in the official website.
Whereas, Sensesemi Technologies are dedicated to “developing the next generation System-on-a-Chip (SOC) that embodies cutting-edge technology, ultra-low energy consumption and embedded Artificial Intelligence (AI) for seamless edge inferencing.”
It is already predicted that three industries including computation and data storage, automotive, and wireless will be experiencing rapid growth by 2030. As semiconductor is an integral part of these industries, Indian economy will be benefitted if this industry is explored in an effective way.
Will India be able to tap the booming semiconductor sector with Tata Electronics and Tesla chip supply deal? The future will tell!
