India is pushing its domestic semiconductor manufacturing industry. This could disrupt the global dominance of China and will have a significant impact on chip supply chains across the globe.
With Prime Minister Narendra Modi, on 79 Independence Day, announcing that Made-in-India chips will hit the market by the end of this year.
China accounts for more than 50% of the world’s chip manufacturing. According to a data from the Semiconductor Industry Association (SIA), China also controls key global production and assembly process. India, however, imports over 90% of its semiconductor from East Asia.
Strategic Realignment in the Global Supply Chain of Semiconductor
Government of India plans an initial investment of $10 billion to its Semiconductor Mission. The mission is looking to attract some of the leading global manufacturers and domestic investors to start an end-to-end chip manufacturing business.
India’s initiative along with skilled engineers have drawn attention of various firms like Micron Technology, which has announced a $825 billion of investment in Gujarat. Though, experts warn that moving upstream to high-end chip fabrication may take years, if not decades.
Semiconductor Chip: Can India Offer an Alternative to China?
Moreover, due to US-China trade tariffs, export restrictions, and geopolitical dynamics, other chip manufacturing sources have increased the search for alternatives. Therefore, India’s entry is on time but may face new challenges like land acquisition, water availability, and technology transfer.
If successful, India could develop as a global strategic manufacturing base for trusted semiconductor supply. Thus, contributing to global change and possible reduction in China’s supremacy in the chip manufacturing ecosystem.
Also Read: Made-in-India Semiconductor Chips to Clean Energy: What’s behind PM Modi’s Independence Day Vision
