India's semiconductor Industry

by Ashutosh

Today the world is moving fast and entering a new phase where smart gadgets and machines are dominating most workplaces. Due to this, the demand for semiconductor chips has reached its peak.

semiconductor chip

In this article, we are going to discuss about Semi Conductor Chips and why India is not successful in manufacturing Semiconductor Chips despite its rapid economic growth. Semiconductor chips consist of semiconductor substance which controls and manages the flow of electric current in electronic equipment and devices. As a result, it is a popular component of various electronic chips like computing components and a variety of electronic devices, including solid-state storage.

Today semiconductor industry value is more than 550 billion dollars. But still, only a handful of countries like Taiwan, South Korea, China, United States dominate this market. The reason for the domination of these nations is, unlike other industries, the semiconductor industry is well a settled industry in recent decades. Due to this, well-established networks have been already created, which are very hard to challenge by new players. If somehow India built its own semiconductor chip then no one will show any interest in buying them.

There are various reasons in support for this conclusion. Here are the following reasons -

  1. Global collaboration is the key to success in the semiconductor industry

    To manufacture even one semiconductor chip requires a variety of materials like silicon, photoresist and rare metals with advanced cutting-edge technologies to turn these materials into finished chips. It also requires thousands and thousands of people with specialised knowledge about their design. Thus, in order to provide all these facilities various countries participate in the supply chain. If India wanted to be a leading player, then it has to first establish its supply as well as the market.

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  3. Massive Investments are required for setting up manufacturing units

    Billions of dollars are required to set up a new semiconductor chip manufacturing unit. Research has shown that to set a basic manufacturing unit, 10 to 20 billion dollars are needed. In addition, continuous investments in Billions are also required for running the facility. As manufacturing of semiconductor chips is a complex process, and even a single particle of dust can damage the product. Thus chips are produced under special conditions. Thus it needs well-organized and advanced facilities, which are hard to get in a place like India.

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  5. Lack of infrastructure and skilled labour

    Even though India is continuously improving its infrastructure. But still, there is a huge gap when we compare India with countries like Taiwan, China and the United States. At the current moment, India is incapable to provide the basic infrastructure required to compete in the manufacturing space. India also lacks skilled labour which is an essential part of the semiconductor chip manufacturing unit. Even though India has enormous number of young people but still we lack skilled labour. Thus government should take various initiatives to convert our young population into a workforce of skilled labour.

  6. power supply
  7. An uninterrupted power supply

    The power consumption of semiconductor chip fabrication is enormous. Each manufacturing unit requires a large quantity of constant supply of power. It is a primary hurdle that India has to overcome.

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  9. Requirement of pure water

    Manufacturing even a single chip requires hundreds of gallons of pure water, which may also be hard to find in India in the required quantities.


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