India's Journey in Semiconductor Manufacturing: Current Challenges and Future Prospects

India has long been a global player in manufacturing, with a rich history of producing a wide array of goods. However, the semiconductor industry represents a significant challenge for India, despite its potential for substantial economic and technological growth. This article explores the current challenges facing India in semiconductor manufacturing, the initiatives taken to address these challenges, and the future prospects for the industry.

The Challenges of Semiconductor Manufacturing in India

To establish semiconductor manufacturing industries, several critical prerequisites must be met. Skilled labor, substantial investment, and an in-house research and development (RD) capability are crucial. India currently lags behind in these areas, making it difficult to compete on the global stage.

Semiconductor manufacturing requires immense resources, including sophisticated nanotechnology applications in extremely dust-free environments. Micronanodiodes, micronanoswitches, and delicate processes such as embedding these components on printed goldline circuits require ultra-pure materials. The clean room infrastructure alone is a significant hurdle, as it necessitates the use of treated ultrapure water with a pH of 7, free of chemical residues and dust particles of 5 microns or smaller per square centimeter area. Additionally, the water requirement for cleaning 14-15 layers of micasheets is staggering, with 4-5 million gallons of water daily.

Key materials such as conducting alloys, gold, and molybdenum, along with uninterrupted power supply and readily available silicon, are also indispensable. Meeting these stringent requirements is a considerable economic and logistical challenge. India has been lagging behind due to these limitations, but recent efforts aim to bridge the gap.

Government Initiatives to Boost Semiconductor Manufacturing

Recognizing the importance of the semiconductor industry, the Indian government has initiated several programs to foster growth in this sector. The India Semiconductor Mission (ISM) was launched in 2021 with a total financial outlay of Rs76,000 crore. The mission aims to provide financial support and incentivize companies to invest in semiconductor manufacturing, design, and the display ecosystem.

The ISM is designed to be led by global experts in the semiconductor and display industries, serving as a nodal agency for efficient and smooth implementation of its schemes. The mission comprises several key components:

Scheme for Setting Up of Semiconductor Fab in India: This scheme provides fiscal support to eligible applicants for setting up semiconductor fabs, aiming to attract significant investments for wafer fabrication facilities in the country.

Scheme for Setting Up of Display Fab in India: This scheme supports the establishment of display fabs, focusing on the development of TFT LCD/AMOLED-based display fabrication facilities.

Incentive DLI Scheme: This scheme offers financial incentives and infrastructure support at various stages of semiconductor design, including integrated circuits (ICs), chipsets, system on chips (SoCs), IP cores, and semiconductor-linked design.

Private Sector Involvement and Progress

Several private sector companies, including the Tata Group and Vedanta Group, have shown interest in setting up semiconductor manufacturing facilities in India. These companies have the potential to drive significant investment and innovation in the sector. The commitment of these groups, along with government support, signifies a turning point for India's semiconductor industry.

Although challenges remain, India's journey in semiconductor manufacturing is anticipated to see significant progress in the coming years. The government's initiatives, combined with the industry's growing domestic demand, position India to become a major player in the global semiconductor market. As new technologies continue to develop, the future looks promising for India's semiconductor manufacturing landscape.

Keywords: semiconductor manufacturing, India, clean technology, electronic components