{"id":254318,"date":"2023-08-01T20:52:37","date_gmt":"2023-08-01T15:22:37","guid":{"rendered":"https:\/\/blog.forumias.com\/?p=254318"},"modified":"2023-08-29T14:24:09","modified_gmt":"2023-08-29T08:54:09","slug":"success-with-chips-will-take-much-more-effort","status":"publish","type":"post","link":"https:\/\/forumias.com\/blog\/success-with-chips-will-take-much-more-effort\/","title":{"rendered":"Success with chips will take much more effort"},"content":{"rendered":"\n

Source<\/strong>: The post is based on articles<\/p>\n

\u201cSuccess with chips will take much more effort<\/strong>\u201d published<\/strong> in Live Mint <\/strong>on\u00a01st<\/sup> August 2023<\/strong> and<\/strong><\/p>\n

\u201cChip tactics: on India\u2019s bid to attract major global chip manufacturers<\/strong>\u201d published<\/strong> in The Hindu <\/strong>on\u00a01st<\/sup> August 2023.<\/strong><\/p>\n

Syllabus: <\/strong>GS 3 \u2013 Industrial Policy<\/strong><\/p>\n

Relevance: <\/strong>challenges associated with establishing semiconductor industry in India<\/strong><\/p>\n

News:<\/strong> Taiwan has been a cause of tussle between China and the West, due to its significance in manufacturing advanced microchips for digital devices. India has also entered into the race to become a supplier of advanced microchips.<\/p>\n

How is India trying to become a supplier?<\/strong><\/h2>\n

Despite the setbacks faced by India in failed Foxconn-Vendanta venture<\/strong><\/a>, the PM has still taken efforts to move ahead to attract investment for the establishment of semicon fab units.<\/p>\n

At the <\/strong>Semicon India 2023<\/strong><\/a> conclave<\/strong>, PM offered 50% financial backing to companies looking to establish chip manufacturing facilities in India including offer for low corporate tax rates.<\/p>\n

US-based companies like AMD and Micron<\/strong> have shown interest in investing in India to cover their supply risks. However, looking at the the challenges, it remains uncertain if India can become a significant global player in the chip industry.<\/p>\n

What are the challenges with India in becoming a leader in the semiconductor industry?<\/strong><\/p>\n

Lack of Capabilities:<\/strong> Chips are of various kinds and manufacturing of sophisticated chips is dominated by Taiwan Semiconductor Manufacturing Company (TSMC<\/strong>).<\/p>\n

While a few other companies can produce these chips, catching up with TSMC’s capabilities is challenging.<\/p>\n

Supremacy of the Advanced Economies:<\/strong> The US has shifted away from free trade and adopted an inward industrial policy, under the Chips Act to enforce technology denial to China<\/strong>. China also has its local chip fabrication projects.<\/p>\n

The U.S. has also announced $52 billion in financing support and drawing over $200 billion in commitments. Intel alone has committed $80 billion in investments across the European Union.<\/p>\n

In India, a $10 billion production-linked incentive scheme was introduced, however, a $20 billion venture by Vedanta and Foxconn failed.<\/p>\n

Therefore, while India has an opportunity to establish a modest chip-making ecosystem, becoming a global supplier would remain a challenging task given the geo-strategic interests of the advanced economies.<\/strong><\/p>\n

Must Read: <\/strong>Semiconductor manufacturing in India: significance and challenges<\/strong><\/a><\/p>\n

What can be the way ahead?<\/strong><\/h2>\n

Diplomacy:<\/strong> Diplomacy could play a significant role in India’s bid to join the global chip race.\u00a0Indian Foreign Minister S. Jaishankar encouraged global chip investors to optimize globalization<\/strong> by investing in chip fabrication units in India, combining the advantages of offshore production with risk reduction goals.<\/p>\n

However, India’s best chance of becoming a major player in the chip industry lies in its own R&D efforts.<\/strong><\/p>\n

Efficient Policy Framework:<\/strong> To encourage semiconductor investments and attract other investors, India must support Micron through its incentives. Additionally, India also needs a stable operating environment with predictable policies framework and trade linkages with global markets to attract investors.<\/p>\n","protected":false},"excerpt":{"rendered":"

Source: The post is based on articles \u201cSuccess with chips will take much more effort\u201d published in Live Mint on\u00a01st August 2023 and \u201cChip tactics: on India\u2019s bid to attract major global chip manufacturers\u201d published in The Hindu on\u00a01st August 2023. Syllabus: GS 3 \u2013 Industrial Policy Relevance: challenges associated with establishing semiconductor industry in… Continue reading Success with chips will take much more effort<\/span><\/a><\/p>\n","protected":false},"author":10320,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[1230,9],"tags":[216,8184,10501,10498],"class_list":["post-254318","post","type-post","status-publish","format-standard","hentry","category-9-pm-daily-articles","category-public","tag-gs-paper-3","tag-indian-economy","tag-live-mint","tag-the-hindu","entry"],"jetpack_featured_media_url":"","views":"","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/254318","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/users\/10320"}],"replies":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/comments?post=254318"}],"version-history":[{"count":0,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/254318\/revisions"}],"wp:attachment":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/media?parent=254318"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/categories?post=254318"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/tags?post=254318"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}