CHIP MANUFACTURING IN INDIA
WHY IN NEWS :
- Recently, US semiconductor firms Micron, announced projects in India, fuelling India’s hopes of becoming a player in the global supply chain for chips.
STATUS OF CHIP MANUFACTURING IN INDIA:
- There is no skilled talent available to handle chip manufacturing plants in India. There will be a requirement of 10,000-13,000 human resources to meet industry requirements by 2027.
- For semiconductor manufacturing, other than Strategic Works, SCL etc, we do not have skilled manpower readily available in India.
IMPORTANCE OF CHIP MANUFACTURING:
- India has identified electronics manufacturing as a key sector to boost its growth in the coming years by producing goods not just for the domestic market, but also for exporting to the world.
- Building semiconductors domestically is crucial for the government’s vision to develop a domestic electronics supply chain.
SOURCE: MAXIMIZE MARKET RESEARCH
- It will also reduce its imports from foreign countries, especially China ,which despite its own challenges remains to be the number one destination for such manufacturing.
- Countries that have chip making and assembly plants can gain significant strategic advantages and, importantly, de-risk from Taiwan Semiconductor Manufacturing Company, which has a global chip fab market share of 55%.
- Given the geopolitical tensions involving China, dependence on Taiwan can prove fragile.
- The new facilities in India can help attract smaller companies to cater to bigger ones such as Micron, which in turn can help build a circular economy in the semiconductor space.
ABOUT NEW CHIP MANUFACTURING PROJECT:
- Micron’s project is for assembly, testing and packaging, while Applied Materials will open an engineering centre that will develop components for chip manufacturing.
- Lam Research, unveiled a virtual precision engineering training platform for semiconductor engineers.
- All of these are part of the process for making semiconductors.
- Micron comes after a chip is first created using lithography at fabrication plants, also known as fabs.
- The latter is very expensive since they require specialized machinery, components and equipment.
- It also needs a vast supply chain, plus uninterrupted power and water.
IMPORTANCE OF MICRON’S PROJECT :
- Assembly, testing and packaging facilities are a good first step.
- Such plants can help build a supply chain for advanced components, as well as attract multiple small vendors.
- Eventually, setting up such a network may attract a chip fab to India, once a more robust semiconductor assembly and packaging network is set-up.
- The new projects will help India progress toward setting up its own semiconductor ecosystem, thus making India less dependent on other nations for chip supplies.
- In the long run, this will boost multiple sectors beyond electronics — such as automobiles, appliances and machinery.
- Micron said its project will create up to 5,000 direct and 15,000 indirect jobs.
- Lam Research said that its platform will train up to 60,000 engineers over 10 years.
- Fabs are largely automated, it is the assembly and testing plants that will generate more jobs.
- They also require engineers to be upskilled.
- India is already a key contributor to semiconductor design but lacks hardware engineers. The new facilities can help create that pool.
ABOUT GOVERNMENTS MANUFACTURING FACILITY:
- The Semi-Conductor Laboratory, Mohali (SCL) formerly known as Semiconductor Complex Limited (1982-2005) is a research institute under the Ministry of Electronics and Information Technology (MeitY).
- SCL runs a Class 10, 6-inch wafer facility with an annual capacity of 20,000 wafers based on 1.2-micron CMOS technology. Now in the process of moving to 0.8-micron technology, the facility is upgradable to 0.6-micron production and 100,000 wafer-processing capacity per year.
- Mohali’s Semiconductor Laboratory (SCL) is expected to be ‘modernized’.
- Under a $10-billion semiconductor production- linked incentive scheme, the Centre is seeking proposals from firms to take over and modernize the fab.
- The new testing and component development facilities may boost SCL’s ability to attract investments from global chipmakers.
WAY FORWARD:
- Government policies should also focus on assuring and securing access to foreign technology suppliers through trade and foreign policy to ensure a global level of collaboration.
- World class, sustainable infrastructure with swift transportation, large quantity of pure water, uninterrupted electricity, communication, pollutant free environment should be provided as required by a modern Fab unit.
SYLLABUS: MAINS, GS-3, INDIAN ECONOMY
SOURCE: LIVEMINT
