India's semiconductor ambitions have garnered attention as the country aims to attract Taiwanese semiconductor partners to drive its chip industry forward. Ajai Chowdry, Co-founder of HCL and Chairman of EPIC Foundation, highlighted India's semiconductor mission at the recent Supply Chain Summit co-organized by DIGITIMES and the India-Taipei Association. Chowdry aims to finalize investment decisions within two years and commence production within five years, focusing on 28nm and mature nodes to cater to the domestic automobile and white goods markets.
While there is optimism around Chowdry's vision, concerns have been raised about the accelerated timeline for mature semiconductor processes. DIGITIMES Research analyst Eric Chen is optimistic about the government's commitment to improving investment efficiency but considers the proposed timeline overly optimistic, given the complexities of semiconductor manufacturing. He estimates that establishing a semiconductor wafer fabrication plant in India may take an additional 2.5 to 3 years after the initial project announcement due to several challenges, including insufficient infrastructure and stability of power and water supply.
Chen also stresses the importance of favorable conditions for foreign investments, talent development, and supportive infrastructure to establish a semiconductor ecosystem in India. Despite the potential for the Indian semiconductor market to reach $55 billion by 2026, significant hurdles remain in achieving indigenous semiconductor production.
Regarding Micron's plans to initiate operations in India, particularly with backend packaging, Chen sees this as a positive step but emphasizes that Micron's success in India will be a key indicator of India's semiconductor policy readiness and overall ecosystem preparedness. The presence of Micron and its success in India could attract more supply chain partners and contribute to the development of a more advanced semiconductor ecosystem in the region.
The analyst points out the substantial market opportunity for local production in India, highlighted by the trade deficit of nearly US$21 billion in semiconductor trade for India in 2022. With India's significant population and demand for semiconductors, the growth of the Indian semiconductor market is expected to be sustained as more electronic industries establish themselves locally.
Chen supports the emphasis on producing 28nm and more mature processing in India, noting its reasonableness for covering most products, especially in white goods. While recognizing the need for advanced processes, he finds that mature processes should suffice for simpler devices and advocates for a step-by-step approach to achieve 28nm capabilities in India within a realistic timeline of about ten years.
India's semiconductor ambitions face both optimism and skepticism, with the success of initiatives such as Micron's operations in India and the establishment of a mature semiconductor ecosystem serving as crucial factors in the country's semiconductor future.
