India to invest $30 billion in technology sector and chip supply chain

Chip shortages have hit the electronics market significantly and the world is facing its consequences since the 2020 pandemic. Despite this, the demand for chips in the Indian market is continuously increasing. Chip demand in India is said to reach $110 billion by 2030 and by that time India hopes to strengthen the supply chain and the entire technology sector. As a result, India is all set to invest $30 billion in the technology sector, including in the semiconductor supply chain. Also Read – Qualcomm India Partners With MeitY’s C-DAC To Help Indian Chipset Startups

$30 billion will be spent on restructuring the Indian IT industry and promoting local production of semiconductors, displays, advanced chemicals, networking and telecommunications equipment as well as batteries and electronics. Also read- Chip shortage, Kovid cost Apple to $8 billion: CEO Tim Cook

According to Gauranglal Das, Director General of the Indo-Taipei Association (via) Nikkei Asia), “demand for semiconductors has increased,” and the chip demand rate in India will double the global rate every year. Also read- BREAKING: US imposes sanctions on semiconductor supplies to Russia

“By 2030, India’s semiconductor demand will reach $110 billion. So by that time, it will exceed 10% of global demand,” he continued.

He adds, “We need some reassurance that our demand for semiconductors is not hostage to supply chain vagaries – something we saw during the pandemic.”

In India, chipsets made will be more “mature”, as opposed to the US and EU aim to produce the most cutting-edge chips. That being said, these chips will be less advanced and will be based on 65nm and 28nm fabrication. The most common use cases for this production technology would be connectivity chips, display drivers, controller chips for electronic products and electric vehicles.

Das said India has a substantial pool of engineers which will eventually help in attracting foreign investors and overhaul the local electronics industry.

Talking of collaborations, he revealed, India is ready to work with Taiwanese tech players who have expertise in semiconductors, displays and electronics. One of the early players to collaborate with an Indian player already is Foxconn. The Taiwanese company has joined hands with Vedantu Limited to set up a semiconductor plant in India.

Apart from chips, LCD is also being worked on with this investment. Displays for TVs, tablets, smartphones and automobiles are expected to be made in India. The focus for the display will not only be on LCD technology but also on OLED panels, which have now become mainstream in premium and foldable phones.

Of the $30 billion, about $10 billion will go towards two chip facilities and two display plants. About $7 billion will go towards the electronics industry, which includes manufacturing giants such as Foxconn and Pegatron. The remaining $13 billion will go towards services such as telecommunications, battery cells, networking, solar photovoltaics, and refined chemistry.

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