The Hindu Business Line : ‘India needs 3-4 fabs to face global competition’

Circuit dynamics
Without infra, India will be at mercy of emerging powers.
Needs to decide if it wants to be a complete player or include outsourcing.
Global semiconductor sector revenue growing 8-10%.

M. Somasekhar

Hyderabad, Feb. 18 India should plan to have 3-4 semiconductor fabrication facilities (fabs), which should suffice to face global competition, according to top officials of the San Jose, California based, Semiconductor Equipment and Materials International (SEMI).

There is need for India to emerge as a producer of all kinds of chips (integrated circuits).

Hence, the demand for necessary infrastructure or else the country would be at the mercy of emerging powers like Korea, China, Japan and Taiwan.

SEMI, which sets global standards for the semiconductor industry, would be willing to bring in all the players involved to set up a possible ‘greenfield’ fab in India on a single platform, they said.

India lead

Mr Stanley T. Myers, President and Chief Executive Officer (CEO), SEMI, and a veteran in the semiconductor industry, said: “India is leading the way in the development of smart cards, mobiles, basic software, navigation for automobiles, low-end laptops, etc”.

Most of these are silicon based.

To get the momentum going and emerge as a key player, India would require strengths in chip design and manufacture.

The issue is whether to be a complete player or develop key strengths and outsource the others.

India should develop a fully integrated manufacturing system in the semiconductor area, feels Mr Paul L.M. Davis, Executive Vice-President of SEMI.

There is a growing demand for the products in the domestic market, the manufacturing industry offers huge job opportunities, consumer electronics is driving the chip design industry, and hence the country needs to be a complete player, he told Business Line here.

Growth rate

The global semiconductor industry is showing around 8-10 per cent average growth in revenues and 12-15 per cent average growth rate in unit product basis. Growing middle class hunger in both China and India as well as the production areas coming up would drive the growth upwards in the near term, Mr Myers said.

Personal Digital Gadgets seem to be driving the market in emerging economies, while innovations in segments like automobiles, safety devices and consumer electronics are all pushing the chip features further. In fact, silicon mobility is being stretched to its limits, said Mr Myers, who has been closely associated with the industry.

SEMI is currently engaged in the massive exercise of facilitating wafer transition from the present 300 mm to 450 mm or towards more efficient chips. “We bring in critical decision makers and scientists to discuss issues and then optimise effort and investments, as the transition is getting tougher and expensive,” he said.

With its global presence and more than 1,500 volunteers from all areas of the semiconductor industry, SEMI wants to bring the best to countries and technology developers, Mr Myers said.