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India is the largest R&D house for Intel outside of US: Nivruti Rai

Debangana Ghosh | | Updated on: Dec 09, 2021
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Intel is counting on India as the country plays a critical role for development, execution as well as for innovation, Rai says

With the pandemic disruptions and chip shortage creating chaos in the technology world globally, one company especially had a good time having built a strong product pipeline of data centre services, chipsets, IoT solutions and partnerships with the top cloud service providers, hardware and electronics manufacturers around the world. In an interview with BusinessLine, Nivruti Rai, Country Head, Intel India and Vice-President, Intel Foundry Services takes us through the company’s business plans, tech innovations for India, and industry challenges lying ahead.

The government has kept the incentives open-ended and customisable for semi-conductor manufacturing under PLI scheme. Is Intel looking at the opportunity? What are your expectations? How much would you invest?

The entire semiconductor industry ecosystem, when you think of any product, there’s got to be a demand, and there’s got to be a supply. When you look at India, you know, there are certain areas where we are very strong. So, on the supply side, think of design services, we are very, very strong there. In software, we are very strong but in terms of semiconductor manufacturing, non-existent. In fabless design houses, we are getting there. In terms of people being able to do assembly test manufacturing, not really. Then comes the demand side, which includes OEMs and ODMs for instance, phone manufacturing.

Whenever we think of semiconductors, we’ve got to think, do we have a demand and supply? And, therefore you’ll realise that, often times it’s quoted that setting up a fab, setting up a semiconductor ecosystem is very, very challenging and has high barriers of entry. But having said that, the government is very keen on understanding this entire ecosystem. We are all contributing towards getting the ecosystem built, and we are contributing in many ways. When I look at the PLI schemes, I’m very excited that the government is offering PLI schemes for electronic devices, technology products that can benefit and we are already there in some of these areas in automotive and other products like PCs on the consumer side, IoT like devices, and many other.

I’m happy to tell you that we worked with the government of Kerala over quite a few companies, both public and private and even a start-up that we incubated to create a laptop, which was entirely assembled including a few components from India. So, slowly the country is moving towards manufacturing. But during this whole experience we realised that there are tremendous amount of needs. We need infrastructure support, communications connectivity support, and policy regulatory framework. And in addition, most importantly, we need skilled labour.

India is fortunate to have availability of graduates, availability of engineers; several million engineers graduate each year, and that opportunity to provide skilled labour is definitely there with India. And along with this, pandemic push happened to digitisation, and then shortage of semiconductor has happened. Intel recently announced its IDM 2.0 strategy, as well as Intel foundry services. IDM 2.0 just simply means we are opening our fabs for external fabless design houses, as well as committing to leverage other foundries for Intel products…Our CEO announced expansion of our fabs in Arizona. We are setting up two new fabs and investing $20 billion for the same. We are seeing as a world shortage of semiconductors, there are countries where these shortages are felt even more than others. And Intel is working towards how do we provide our leadership products in addressing some of these?

We are also seeing a lot of homegrown start-ups like Saankhya Labs, which has entered this space. How are you viewing these developments within the country? And do you see them as a competition?

India is the largest R&D house for Intel outside of the United States and we are continuing to grow. In terms of enabling manufacturing, we are doing a lot, leveraging local companies to even manufacture for Intel. We are doing quite a few things and we will continue to do that. The ecosystem is really big, we have to lay brick by brick, and it will happen in India. The government is pushing and ecosystem players are gearing up. One of the ecosystem players that I absolutely love is Saankhya Labs, and they are not a competition. I would only want to encourage such companies like Saankhya Labs, which are fabless design houses that we need, they are critical.

I’m very excited about Saankhya Labs, I want many more Saankhya labs to come. And I do believe with the start-up ecosystem that we are trying to fuel, there are many more companies in this space that are coming up. I really hope that they scale larger and larger and fulfil India’s need. If you look at the needs that India has at present in terms of semiconductor is very small. I only want to encourage and collaborate with them to make them meaningful to make them big.

Given the kind of partnerships and businesses you’re working with, what were the major disruptions you had worked on during the pandemic? And also, how do you see that changing your game plan for say, the next two years?

Pandemic has accelerated adoption of technology by at least three years. So, some adoption that could happen gradually in two to three years happened instantly. And, in the past, a lot of the use of semiconductor was considered luxury. You have many semiconductors use cases in high-end cars, fancy refrigerators, laptops and phones to name a few, but now that makes semiconductors a necessity. In the past, many of these semiconductor requirements were not that important for life. Now, if you look at it, education needs semiconductors, health needs semiconductors – it has become a need rather than a want. And to enable such kind of needs, there are few technologies that are very critical.

One is cloud, enabling a lot of computing on the cloud. There is network, and Intel Edge. So, there is a cloud connecting network and then Edge is distributed compute. I have the ability to provide good quality service, because my data doesn’t need to go to the cloud to get processed, it gets processed closer to me through Edge. Cloud, network, Edge, and AI, I believe, are the few technologies, which will be driving the digitisation need that the world is seeing. And I’m happy to say that Intel is providing solutions for all these.

Intel has been working with all the top cloud service providers. With the pandemic accelerating cloud adoption by manifolds, how did Intel work its way through the demand? Were there fixes needed in the technology given that cybercrime had thrived simultaneously?

During the pandemic, we have seen 64 per cent of organisations in India raised the demand for cloud computing. And a similar number for cloud software. This is because all of us, who have technology roles are working from home. And working from home requires a lot of connectivity support, that translates into a lot of compute and cloud kind of need.

You had earlier mentioned Saankhya Labs. Many such companies that are small today cannot have their own private cloud. So they leverage these cloud services, like AWS, or Microsoft Azure or Google which offer pay for the services as you go option. You have probably heard many times about getting platform as a service, you can get infrastructure as a service and software as a service. Cloud guys are leveraging this opportunity. Depending on what kind of need the cloud service guys are servicing, they’re using Intel Edge and Xeon servers to provide the right kind of solutions. And what is exciting is when data is travelling through the air, with all of this digitalisation, people going online to even buy groceries.

At the same time security becomes really critical. And there are multiple levels of security that we are offering. Firstly, the most robust one, which is the hardware level security. We also have Intel Software Guard Extensions, and memory encryption which creates a secure space to perform certain computation. So, Intel is looking to provide the capability of these high-performance compute along with additional safety at all levels.

In the last two years, Intel has been investing on data centres in India. So, wanted to know about the company’s growth and plans in the research and development area, as well as what’s the strategy for data centres?

After United States, India is the largest R&D house. And in India, there was a time when many companies like us were doing only pieces of work or certain work in the back end, but not the front end. I’m happy to tell you that now, we are working on cutting edge technology development, whether it is building a microprocessor of different performance power envelope, building IPs like graphics, media, etc. We are also building connectivity solutions with Silicon Photonics, we are building system on chips (SoCs) that go into client servers and are building SoCs that go into servers of data centres.

From all kinds of compute which addresses Cloud Data Centre client, IoT, and leveraging technologies like AI, 5G and autonomous driving, we are doing it all. It’s leading cutting-edge work and we have been growing over the so many years to an extent that now. We have $7 billion invested in India. Not so long ago, I used to say $5 billion. So, Intel is counting on India as the country plays a critical role for development, execution as well as for innovation.

Are there particular sectors within your industry that you think are going to take off from here on in India and most likely to find more opportunities within the country from a tech perspective.

So, I really think the telecom sector, the networking sector will find more use cases that will and these will not be only limiting to phones, they will be looking at various other use cases with the advent of 5G. With 5G, there are many technologies that are being leveraged and the intent is how do we make it such that the very function specific equipment getting translated into commercially off the shelf compute products and then build software to differentiate whether it is radio access network. We support these telecom service providers, you will see content delivery network and other OTT like use cases coming up. We are working very closely with Bharti Airtel, in building their 4G, 5G solutions and virtual RAN solution leveraging a lot of Intel components, whether it is ES6, Xeon, high performance computer processors, FPGA, or Ethernet.

Similarly, with Reliance, we are working not just on networking, 5G, radio, wireless access code, but we are also providing a lot of AI for interesting use cases, we are looking at cloud gaming and edge compute. We are doing a lot of work with large companies, but even smaller health tech companies like Netra.ai, which is leveraging our solutions. We are partnering with many government, and private sector entities, and trying to enable them to enable India with more relevant start-ups that will be the need of tomorrow.

What segments of your business have been the most investment heavy in India? How has it evolved over the past few decades?

Our growth in Intel India has been commensurate to what Intel overall is, we are a perfect microcosm of global Intel. Cloud is going to be important. So, we have a very strong presence in data centres group. Client is very important. We have a very strong client team. By client team I mean those working on client IP, client SoC, client platform hardware and software enabling and client kind of solutions. We also have IoT that will play a critical role in industrial automation for factories, etc. So, definitely, these areas and technology. AI has been inside my DNA from, 10-12 years ago, incubating an AI inference engine with my team here in India, to now having a very large presence of our team driving global solutions, technologies like AI and 5G also are a critical growth area for us.

Globally Intel has been investing in really disruptive start-ups. Are you looking at a similar prospect for Indian start-ups? What will be your investment strategy?

We have been driving a start-up programme for several years now. And I can tell you that, till now, over the past three to four years, we have incubated 85 start-ups in India. Many of these incubators nowadays take pride in telling that we have incubated 500 start-ups, but the reality is, in five years, almost 90 per cent of these start-ups die. Within Intel, we’ve have a goal that we will not just look at the number of start-ups but look for those start-ups which are into advanced technology areas, such as IoT, AI, vision, speech, simulation, and platform security to name a few. Around 36 of the start-ups from our programmes are generating significant revenues. And if I look at the valuations of these start-ups, it’s about half a billion dollars. So I’m very excited about hand holding many of these start-ups and taking them to the revenue generation phase.

We also ran a programme that we call Plugin till this year with IIT Bombay’s vertical called SINE. Together we ran a deep tech accelerator programme. We had three editions of the programme and have nurtured 34 start-ups there. But recently, say a month or few weeks ago, we changed the format of Plugin and named it Plugin Alliance.

In Plugin Alliance, we roped in 58 members which are large industries, mid and small industries, as well as design houses and start-ups. The intent is to create an ecosystem that nurtures these participating start-ups. It is exciting that from this alliance itself there was a company that found a customer, and there are companies which are finding VCs. So, the intent is to create a platform where we can help the start-ups find innovative build, adopt and scale solutions… We have a very good filtering mechanism to pick worthy start-ups to take forward, as we are putting a lot of thought leadership and partners’ investment.

How do you view the global chip shortage and standoff between China and US impacting this further? How is it playing out for Intel at the moment globally and in India?

There is definitely a chip shortage and one of the reason why we came out with our foundry capabilities is to have more capabilities in the semiconductor space. Bulk of the semiconductors go into the automotive space. In each car, there’s an engine control unit (ECU) which includes power trains, windshield wipers, windows and all the way till ignition requires semiconductors. In an average car, which is not very high-tech there are at least 50 ECUs used. So for ease of math, for 100 ECUs in a car, there are 5,000 processors sitting.

When pandemic started, semiconductors were required for critical things and cars faced a shortage. We have announced our foundry services and automotive is another critical sector we are looking at. Our global CEO recently was travelling to Europe and looked at what are the requirements for the automotive sector and being prepared for it.

Published on December 14, 2021

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