The Hindu Business Line : `Desi' semiconductor biz is `all chip shape'

An interesting fact emerged, when half a dozen leading international silicon chip manufacturers banded together last month, in a `Power Forward' initiative, to `lower the heat' and produce semiconductors to a common format thatwould make them cooler, less power hungry.

Since many of the partners - AMD, ARM, Freescale, Cadence - had design centres in India, a piquant situation developed where, research initiatives in the `cool it' drive, while ostensibly carried out by geographically disparate players, were actually executed almost wholly by Indian engineers working in India.

And earlier this month, the annual get-together of the Indian Semiconductor Association (ISA) further underlined this fact of life in the chip business:

A growing sector

The release, on the occasion of the first members' directory of the 18-month old association showed that the India-based semiconductor industry had grown, from almost zilch at the turn of the century to 88 key players today: a remarkable achievement for a country that is yet to see its first industry-scale silicon foundry. That may come soon, thanks to consortia initiatives such as SemIndia, which has the technical backing of international chip leaders like AMD.

Proactive ISA

Meanwhile, with ISA playing an increasingly proactive role in evangelising India as a chip design and manufacturing destination, global players are slowly looking at the market here and in the region, as a possible rationale for setting up semiconductor manufacturing. When that happens, the country might well emerge as a one stop-chip-shop for services from circuit and system concept to fabless design and manufacturing. To provide the numerical persuaders, ISA joined hands earlier this year with Frost and Sullivan top bring out a landmark survey report on the Indian Semiconductor and embedded systems industry (2005-2015). (The summary can be found at the ISA's website www.isaonline.org)

$300b opportunity

The report signposts a $ 300 billion opportunity and provides detailed projections of the growth patterns in sectors such as digital signal processing chips, sensors, analog devices, logic circuits, consumer electronics and communications.

Hardly a month passes without the ISA arranging a breakfast meeting or a business-like lunch where global "chippies" from the ARM CEO, Mr Robin Saxby, to the Texas Instruments boss, Mr Rick Templeton, to the Philips' head, Mr Frans van Houten, interact with Indian industry leaders in Bangalore, Hyderabad or Delhi. The ISA President, Ms Poornima Shenoy, sees no reason why the industry should sit around waiting for the silicon foundries to come here: "We have unique strengths in developing intellectual property for semiconductors", she told Business Line, "We must partner with strong manufacturing countries to quickly turn design ideas into products".

`Made in India' brands

That may happen sooner rather than later: In May, for the first time, a strong team from the Suzhou Industrial Park, near Shanghai, came to Bangalore - a quick follow-up to the visit of an ISA team to China - and offered various levels of collaboration with Indian chip players.

All of a sudden it seems, the old principle that India was great at software - but a lousy option for manufacturing - is being rewritten. Nokia is turning out a million phones a month from its base in Chennai. Ericsson, Elcoteq, Flextronics and soon Motorola are already creating a `made in India' brand. Up North in Greater Noida, Moser Baer has already shipped the first high density BluRay DVDs. And if the 88 members of ISA have any say in the matter, Indian manufacturing may soon go microscopic, as chips, not just assembled boards and products, roll off the production lines.

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