ICEA Proposes Semiconductor Design, Manufacturing as India's Strategic Sector

In a strategic move to bolster India's position in the global semiconductor landscape, the India Cellular and Electronics Association (ICEA) has put forth a series of recommendations aimed at enhancing the country's semiconductor design and manufacturing capabilities. The ICEA's latest report underscores the necessity for significant investment and policy reforms to establish India as a leader in semiconductor product design and Intellectual Property (IP) creation.

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The association has called for the mobilization of large Indian corporates to invest in semiconductor design, emphasizing the sector's strategic importance. A notable suggestion from the report is the establishment of an exclusive market exchange tailored for the electronics and hi-tech industry, which is expected to spur growth and innovation while positioning India as a global hub for electronics and semiconductor manufacturing.

Addressing the challenges posed by international competition, particularly from China, the ICEA highlighted the need for vigilance and strategic alliances to prevent the dumping of advanced node and memory chips into the Indian market. Such practices, if unchecked, could lead to a scenario where domestic companies face significant disadvantages, similar to the global TFT-LCD market's downturn.

The report also advocates for substantial governmental and policy support, including the inclusion of mask sets—stencils used in semiconductor production—in the Design Linked Incentive (DLI) scheme. Proposing up to an 80 per cent subsidy for Indian design firms on mask set costs, ICEA aims to strengthen India's Intellectual Property Rights (IPR) framework significantly.

Furthermore, ICEA recommends innovative funding strategies and treating semiconductor chip design/manufacturing as a strategic sector. This approach would facilitate access to low-cost funds and establish a dedicated capital market system for the electronics and high-tech industry. Amidst shifting global semiconductor manufacturing dynamics, especially with US sanctions on China, ICEA identifies a strategic opportunity for India to progress into sub-14 nm technology nodes. The report suggests leveraging spare capacities, like those of TSMC for 7nm technologies, to fast-track India's entry into advanced semiconductor manufacturing.

Government investment in refurbished fabrication plants (fabs) and support for semiconductor design firms are also deemed crucial by ICEA. Building a skilled workforce is highlighted as essential for fostering a self-reliant semiconductor ecosystem in India. "As we navigate through a transformative era in electronics manufacturing and hi-tech, India stands at a pivotal juncture to redefine its role in the semiconductor value chain," stated Pankaj Mohindroo, Chairman of ICEA, underscoring the significance of these initiatives at a conference.

The recommendations put forward by ICEA represent a comprehensive strategy aimed at propelling India to the forefront of global semiconductor innovation. By addressing key areas such as investment, policy support, strategic alliances, and workforce development, India seeks to capitalize on current global shifts in semiconductor manufacturing and secure its position as a major player in the industry.