Global chip wars race intensifies: Time for India’s big leap?

World

Semiconductor manufacturers worldwide will begin construction on 19 new high volume fab by the end of December 2021 and break ground for another 10 in 2022. This is being done to meet the unprecedented demand of chips across various industries like healthcare, communications, online services and automotive, electronic, computing, informed SEMI, an industry association representing 2,400 members in the semiconductor industry.

China and Taiwan will lead the way in the new foundry construction with eight each, followed by the Americans with six, Europe/ Mideast with three and Japan and Korean with two each. Taiwan accounts for 63 per cent of global chip making, with South Korea maintaining 18 per cent and China accounting for 5 per cent global share in chip manufacturing.

The massive investment in the chip manufacturing in Asia comes amid worldwide supply shortage due to the increasing demands for chips to power 5G devices and smart vehicles. The fab capacity expansion in the longer run will meet the strong demand for semiconductors stemming from emerging applications such as artificial intelligence, high- performing computing and 5G to 6G communications.

Recently, Global foundries broke ground for its new fabrication ground in Singapore investing over 4 billion dollars to meet the accelerating demands for chips. The new facility will be developed in partnership with Singapore Economic Development Board.

Taiwan Semiconductor Manufacturing Co, the world’s biggest chip manufacturer commenced its first fabrication in Japan after the government put domestic supply chain for semiconductors high in its agenda.

Twenty nine fabs are likely to be established over the next few years to address the growing demands for chips. The market for semiconductors is expected to grow 5% over the next decade.