India`s High-stakes Bid to Become a Global Semiconductor Hub: Will it Succeed?
| Case Code: ECON104 Case Length: 13 Pages Period: 1960-2024 Pub Date: 2024 Teaching Note: Available |
Price: Rs.400 Organization : Industry : Technology & Communications Countries : India Themes: Government & Economy, Business Environment,Government Policies,Technology Strategy |
Abstract Case Intro 1 Case Intro 2 Excerpts
Excerpts
India’s Semiconductor Journey
India’s entry into semiconductor manufacturing dated back to the 1960s, when a small number of enterprises began producing germanium semiconductors . Fairchild Semiconductors, an early innovator in integrated circuit (IC) technology, looked at India as a potential location for its first Asia facility. During the 1960s, Bharat Electronics Ltd. (BEL), a public sector undertaking (PSU) under the Ministry of Defence (MoD), obtained germanium and silicon technologies for producing semiconductor devices. BEL along with Hindustan Aeronautics Ltd. (HAL)..
Stumbling Blocks
Given that India was starting its manufacturing journey from scratch, there were various challenges that needed to be overcome. Once a fab had been approved and construction of the facility had begun, there were challenges in procuring raw materials and finding a trained crew. After these challenges were overcome, there was the bigger challenge of acquiring enough orders to become viable..
The Road Ahead
APCO Worldwide, a US based advisory and advocacy communications consultancy, in its 2024 report titled “India semiconductor Sector: Increasing India’s Role within the Global Semiconductor Value Chain”, stated that to foster a vibrant semiconductor ecosystem, the Government of India (GOI) should implement market-based incentive programs to enhance India’s semiconductor research, design, and manufacturing capabilities. Most essential, markets must be available to all participants. Industrial success should be driven by the competitiveness of enterprises and their products, rather than government interventions. Government support for domestic semiconductor manufacture should consider the requirement for additional capacity to meet growing global demand..
Exhibits
Exhibit I: Semiconductor Classification
Exhibit II: Semiconductor Supply Chain
Exhibit III: Companies across the Semiconductor Value Chain
Exhibit IV: Top 10 Semiconductor Vendors by Revenue (2023)
Exhibit V: India’s Semiconductor Policies (2015–2022)
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