India Pushes for Semiconductor Supply Chain Diversification with New Meity Initiative

The Indian government is prioritizing the diversification of the semiconductor supply chain, with the Ministry of Electronics and Information Technology (Meity) developing a follow-up scheme for the promotion of electronic components and semiconductor manufacturing. This follows the end of the SPECS scheme on March 31, according to Meity Secretary S. Krishnan.

At the launch of the fabless semiconductor startup IVP, Krishnan emphasized the importance of a diversified semiconductor supply chain, a lesson underscored by the pandemic. “Diversification is crucial to avoid over-reliance on a single supply chain. The Government of India is committed to this,” he said.

Krishnan highlighted India’s prominence in semiconductor design, with 20–25% of the global design workforce based in the country. However, he acknowledged the distinct challenges in the manufacturing sector.

Of the $10 billion (Rs 76,000 crore) allocated for the semiconductor mission, approximately Rs 70,000 crore has already been committed. Krishnan mentioned Tata Electronics’ construction of a large semiconductor fabrication facility (fab) in Dholera and stressed the need for more such fabs and associated suppliers and equipment manufacturers. “Many of these suppliers are small companies—nearly 300 vendors—who need to be in close proximity,” he explained.

IVP Semi CEO P. Rajamanickam shared the startup’s goal of becoming an Indian-branded chip company with aspirations to compete globally. “We aim to produce end products that will compete with global companies, focusing on the power sector, especially renewable energy, storage, and transmission,” he said.

Addressing the funding challenges faced by Indian semiconductor startups, Rajamanickam noted the government’s support in establishing a strong supply chain and emphasized the company’s commitment to deep chip design within India.

IVP Semi is collaborating with the Tamil Nadu government to establish a production test facility on a 20,000-square-foot site in Chennai. “The Tamil Nadu government is eager to support the development of a chip company like ours. We plan to set up test centers in Chennai with their participation, either as a grant or equity. We are in discussions with the Tamil Nadu Industrial Development Corporation and plan to hire 200 to 300 people,” he added.

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