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PLI Scheme for Semiconductors Drives Growth, Srinivasa Gupta, SmartSoC

Recent interaction with DQChannels, Srinivasa Gupta, CTO, of SmartSoC Solutions shared insights on the growth prospects of the semiconductor industry in India.

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Bharti Trehan
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Srinivasa Gupta, Chief Technology Officer, SmartSoC Solutions

PLI Scheme for Semiconductors Drives Growth, Srinivasa Gupta, SmartSoC Solutions

What are some of the key emerging technologies within the semiconductor industry that will have a significant impact on Indian markets?

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Some of the key emerging technologies in the semiconductor industry that are poised to have a major impact on the Indian market include:

  1. Edge AI and IoT: Rapid urbanisation, coupled with income growth, has led to greater affordability of goods and consequently an increase in demand for mobile phones, tablets, and other household appliances. Government initiatives such as ‘Digital India’ and ‘Smart City’ projects have raised the demand for IoT in the electronics devices market and will undoubtedly usher in a new era for electronic products. These advancements give impetus to Industrial, Consumer electronics and healthcare sectors. Many use cases required Edge AI and IoT solutions using real-time data processing and automation at the device level. This upward spiral continues, expands the present market and creates new markets. AI-based traffic management, surveillance, based eldercare, and health monitoring applications are a few examples. 
  2. Chiplets and Advanced Packaging: As transistor size has decreased to minuscule proportions—TSMC recently prototyped a chip with a 2-nanometer process node—the industry recognizes that keeping pace with Moore’s Law through a sole focus on shrinking transistor size is unsustainable. A great advantage of Chiplets and advanced packaging technologies can fill the gap at some extent. Advanced packaging can increase the density of interconnects, thereby increasing signal speed and overall processing power. Packaging has traditionally been a low-value add and labour-intensive step in the semiconductor manufacturing process. Several top firms in advanced packaging are headquartered in the United States, such as Amkor, but nearly all their advanced packaging capacity is located in Asia to capture the advantages of lower labour costs and proximity to electronics assembly plants, the ultimate destination of most chips.¬ Approximately 81 per cent of the global ATP capacity is now located in a variety of Asian countries, according to Boston Consulting Group and the U.S. Semiconductor Industry Association (SIA). India is going to take a significant share of the market by utilizing Indian government support.
  3. Automotive Electronics: With the rapid shift towards EVs and autonomous vehicles, advanced semiconductor solutions are essential. India’s automotive market stands to benefit from innovations in power management, sensors, and infotainment systems.
  4. 5G and Beyond: With the rollout of 5G and planning for future generations, the demand for high-performance semiconductor components is skyrocketing. This development supports India’s goals of digital connectivity across urban and rural areas and enables growth in sectors like healthcare, automotive, and consumer electronics.
  5. Quantum Computing: Though still in the early stages, quantum computing represents a transformative future for areas like cybersecurity, drug discovery, and complex simulations, which could place India at the forefront of tech-driven innovation.

Each of these technologies presents opportunities for Indian businesses to innovate, grow, and contribute to the global semiconductor ecosystem.

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What growth opportunities do you see for the Indian semiconductor industry in the coming years, especially in light of government support and policy initiatives?

The Indian semiconductor industry is poised for significant growth in the coming years, especially with strong government support and policy initiatives aimed at boosting domestic manufacturing and innovation. Some key growth opportunities include:

  1. Government Incentives and PLI Scheme: The government’s Production Linked Incentive (PLI) Scheme for semiconductors is a major growth driver. It encourages investments in manufacturing and design capabilities, reducing India's reliance on imports and creating a robust ecosystem for semiconductor production. This initiative will not only attract global players but also enable homegrown startups and established companies to expand their footprint.
  2. Increased Demand for Electronics: With rising demand for consumer electronics, smartphones, wearables, and industrial automation, India presents a significant market for semiconductor components. As digitalization accelerates in sectors such as healthcare, agriculture, and education, the need for advanced chips will also surge, providing growth opportunities for semiconductor companies.
  3. Focus on Semiconductor Design: India’s strength in IT and software has created a solid foundation for semiconductor design. There’s significant potential for Indian companies to become global leaders in chip design, especially for niche applications in areas like AI, IoT, and 5G. The government’s push for skill development in semiconductor design will help cultivate a highly skilled workforce.
  4. Electronics Manufacturing Cluster Development: The creation of semiconductor manufacturing hubs and electronics clusters, supported by both central and state governments, will foster innovation, reduce production costs, and increase India's competitiveness in the global market.
  5. Emerging Markets and Sustainability: With India's commitment to sustainability and clean energy, there is an increasing focus on energy-efficient and environmentally friendly semiconductor technologies. This aligns with the global demand for green technologies, positioning India as a key player in the future of sustainable electronics.
  6. Global Supply Chain Diversification: Given global disruptions in the semiconductor supply chain, India has an opportunity to become a key player in ensuring supply chain resilience. By setting up manufacturing facilities and becoming a hub for semiconductor assembly and testing, India can attract global supply chain investments.
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In conclusion, India's semiconductor industry is on the cusp of exponential growth, fuelled by government support, a growing domestic market, and the global shift toward digital transformation. With the right investments in infrastructure, skill development, and innovation, India can position itself as a semiconductor hub in the global landscape.

With demand for semiconductors rising across diverse sectors, how is the industry gearing up to meet this demand? What role can India play in fulfilling this global need?

To meet the rising demand for semiconductors, the industry is focusing on expanding manufacturing capacity, investing in R&D for advanced technologies, and improving supply chain resilience. There’s also a strong push for sustainable manufacturing practices to address environmental concerns.
India’s Role:

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India can play a significant role in meeting global demand by leveraging its strengths:

  1. Chip Design: India is already GCC for many fabless and IDM semiconductor companies. Indian GCCs have been contributing to designing advanced SOCs (Systems on Chip) significantly. Indian design centres' contribution is expanding partial chip design ownership to full chip. India can be a leader in semiconductor design, particularly for emerging technologies like AI, automotive, and HPC (High-performance computing).
  2. Skilled Workforce: India’s large talent pool can be trained in semiconductor design and manufacturing, reinforcing its position in the global supply chain.
  3. Manufacturing Hub: With government initiatives like the PLI Scheme, India can attract investments in semiconductor fabs and assembly plants, reducing global dependency on other regions.
  4. Strategic Partnerships: By collaborating with global semiconductor companies, India can contribute to the innovation and growth of the global semiconductor ecosystem.

India’s focus on innovation, manufacturing, and skill development makes it a key player in addressing the global semiconductor demand and ensuring a resilient supply chain.

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What challenges does India face in building a robust semiconductor supply chain, especially in areas like infrastructure, skilled workforce, and manufacturing capabilities?

India faces several challenges in building a robust semiconductor supply chain:

  1. Infrastructure Gaps: The country lacks world-class facilities for manufacturing, including reliable power and cleanroom infrastructure, and needs better logistics to move raw materials and products efficiently.
  2. Skilled Workforce Shortage: While India has a large pool of engineers, there is a shortage of professionals trained specifically in semiconductor design, and fabrication.
  3. High Capital Investment: Semiconductor manufacturing requires significant capital, and attracting sustained investments remains a challenge despite government incentives like the PLI Scheme.
  4. Supply Chain Dependencies: India relies heavily on imports for raw materials and high-end chips, requiring the development of domestic sourcing and manufacturing capabilities.
  5. Technological Gaps: India lags in advanced semiconductor manufacturing technologies, such as EUV lithography, and needs significant investment in R&D to bridge this gap.
  6. Global Competition: Competing with established semiconductor hubs like the USA, Taiwan and South Korea requires India to build a competitive edge through innovation, policy support, and global partnerships.
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However, with ongoing government initiatives, industry collaborations, and investments in infrastructure and education, India is well-positioned to become a key player in the global semiconductor supply chain.

How do you envision the future of semiconductor technology in India? Are there specific areas where India could potentially become a global leader or innovation hub within this industry?

India's future in semiconductor technology is promising, with the potential to lead in areas like chip design for Edge AI, IoT and automotive applications. India has done great in the software industry. Success can be replicated in the semiconductor industry as well. India could become a global hub for innovation, particularly in design, R&D, and software-driven solutions for emerging technologies like HPC, IoT, and Edge AI. With continued support for infrastructure and skill development, India is well-positioned to play a significant role in the global semiconductor landscape.

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