India and EU inks semiconductor agreement for robust supply chain and innovation

India and the European Union formalizes a key partnership on semiconductors on Friday, marking a significant step towards establishing a robust supply chain and fostering innovation. The Memorandum of Understanding (MoU) was inked during a stock-taking call involving leaders of the EU-India Trade and Technology Council (TTC).

According to the EU, the agreement focuses on sharing information related to “granted public subsidies.” Under the MoU, both India and the EU aim to exchange insights, best practices, and information pertaining to their respective semiconductor ecosystems. The collaboration is anticipated to identify areas for joint efforts in research, development, and innovation, involving universities, research organizations, and businesses.

The EU was represented by Executive Vice President Valdis Dombrovskis and Vice President Vera Jourova during the stock-taking call, while the Indian delegation was led by External Affairs Minister S. Jaishankar, Minister for Railways, Communications, Electronics and Information Technology Ashwini Vaishnaw, and Commerce and Industry Minister Piyush Goyal.

Given the strategic importance of semiconductors in the digital landscape, particularly amid efforts to diversify supply chains away from China in the post-COVID era, this agreement is expected to align India more closely with the EU and the U.S. in shaping the future of the semiconductor industry.

Beyond supply chain considerations, the partnership is poised to enhance skills and workforce development in the semiconductor sector. The agreement outlines plans for collaboration through workshops, partnerships, and the promotion of direct investments. Furthermore, the EU emphasizes that the deal will contribute to establishing a level playing field in the semiconductor sector, including transparency in sharing information about public subsidies.

Looking ahead, the EU-India Trade and Technology Council is scheduled to convene in India in early 2024, as outlined in a statement by the EU.

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