The future, driven by the invisible magic of semiconductors, is hurtling toward us at breakneck speed. To say India has grabbed the opportunity by the horns would be an understatement - we’re making waves on the global stage - but there’s still a long way to go. 

Our recent Technology Game Changers panel discussion featured the brightest minds from some of the biggest semicon powerhouses in the world today. Led flawlessly by Prof. Mayank Shrivastava, the dialogue was a goldmine of insights. 

We delved deep into India's potential, the challenges it faces, and the roadmap to success. 

The spotlight is on us as the next major semicon hub, but the burning question remains: Are we ready? 

Here’s the answer. 

From Global Disruption to Opportunity: A New Era for Semiconductors! 

The panel discussion commenced with an insightful analysis of the global semiconductor industry, highlighting both recent challenges and emerging trends. The moderator initiated the conversation by probing the causes behind the global chip shortage and questioning whether it remains a pressing issue today.

Learning for the past, Prepping for the future 

While the pandemic-induced chip shortage caused considerable challenges, it also made us realize the critical importance of the semiconductor industry. The resultant awareness has prompted better preparedness for future disruptions. 

The panelists noted that current reduced demand and shorter lead times provide a valuable opportunity to ramp up production capabilities, ensuring readiness for the next surge in demand and preventing a recurrence of the COVID-19-like shortages.

Are we on stable ground now? 

Panelists unanimously agreed that the acute chip shortage experienced during the COVID-19 pandemic was primarily a result of severe supply chain disruptions. However, they noted that the industry has largely stabilized, and the shortage is no longer the most pressing concern. This recovery has been driven by significant investments and strategic changes across major global markets, particularly in the United States and Europe.

Over the past few years, Western nations have made substantial strides in investing in semiconductor manufacturing. The panelists highlighted that achieving the manufacturing prowess of Taiwan and Korea will require extensive effort, including increased collaboration between industry, government, and educational institutions.

AI is the name of the game 

One of the most promising trends discussed was the projected $500 billion increase in semiconductor supply, driven by the growing need for AI components. As technologies advance towards 5nm and 3nm processes, companies like TSMC, Apple, and Intel are leading the charge. 

With plans for 10 fabs in the USA and 7 in Europe, along with significant developments in the Asia-Pacific region, the future of semiconductor manufacturing appears robust and expansive.

The consensus was clear: AI will be a major driver of the semiconductor industry’s growth, pushing it to new heights.

Viewing semiconductors through a new lens 

A significant shift in the semiconductor market is the move towards diversification, reducing the concentration of manufacturing in just a few regions. 

This diversification is coupled with a new perspective on semiconductors as both an infrastructure and national security resource. This view has gained traction in India as well. 

The global talent gap continues to get wider 

Despite these positive developments, the panelists emphasized a critical challenge: the shortage of skilled talent in relevant fields. 

They stressed that the number of students graduating in semiconductor-related disciplines is insufficient to meet the anticipated demand in the next 5-6 years. Europe, in particular, is looking to India for support, recognizing the country’s potential to supply the necessary talent to sustain growth.

But, can India meet this demand? At present, no. 

The Powerhouse Behind It All - Foundries 

The conversation soon naturally gravitated towards the critical role of foundries in the semiconductor industry. It serves as the foundation upon which the entire ecosystem is built. 

Meeting market demand 

The panelists emphasized that foundries are striving to meet the growing demand for semiconductor components. 

To achieve this, several elements are crucial: continuous innovation, attracting and retaining top talent, and maintaining manufacturing excellence. When this is in place, success is achieved. 

Additionally, to support fabs, there needs to be robust infrastructure, an area where India is currently focusing its efforts. By strengthening its manufacturing capabilities, India aims to build a solid base before pushing the envelope further in terms of innovation.

Building a mindset geared toward service 

Foundries are not just manufacturing units; they are also service providers. This means they bear significant responsibility for ensuring that clients receive high-quality, reliable products. 

Meeting Environmental, Social, and Governance (ESG) goals is also part of this responsibility, highlighting the broader impact foundries have beyond just production.

What does history tell us?

Another interesting point discussed was the need to study historical trends and understand why previous semiconductor empires have crashed and phased out. 

Learning from these past failures is essential to building a sustainable and resilient semiconductor industry this time around. Failure is not an option anymore. 

India’s Semicon Revolution: A Market Set to Takeoff 

In the discussion, the panelists highlighted the significant strides India is making in the semiconductor market. With an industry size projected to reach $600 billion in 2024 and a staggering $1 trillion by 2030, the potential for growth is immense.

Key drivers of growth 

A major driver behind this rapid expansion is the growth of Artificial Intelligence (AI). The panelists pointed out that AI technologies are creating an increased demand for semiconductors, which are crucial for applications ranging from generative AI and data centers to 5G, renewable energy, and e-mobility.

The panelists described the semiconductor industry's structure as a pyramid. At the base are the possibilities that a chip can offer, while at the top are the various applications these semiconductors enable. 

Managing and properly utilizing the influx of new technologies will be key to sustaining this growth.

Why we’re feeling bullish

Government involvement was identified as a critical factor in the industry's success. The entrance of fabs and multinational companies into the Indian market has significantly boosted confidence across the board. 

With a current semiconductor consumption of $27-28 billion, the market is ripe for further development.

Talent influx 

Companies like Tata are optimistic about the future and are actively recruiting top talent from Taiwan and Japan - tapping into the NRI community. Micron has also been a leader in this space, with their new plant in Gujarat and the establishment of an Outsourced Semiconductor Assembly and Test (OSAT) facility, which promises to be a game-changer.

The panelists foresee a future where the world looks to India for talent and skills in the semiconductor industry. 

India’s Strategic Advantage

Source: Maximize Market Research

The panel discussion highlighted several strategic advantages that position India favorably in the global semiconductor landscape.

Demography and Diversity 

India's young population is seen as a major asset, providing a dynamic workforce that can adapt to the evolving demands of the semiconductor industry. The inherent diversity within the country also fosters a rich pool of ideas and innovation.

However, the panelists emphasized that skilled and trained professionals are crucial. Execution, backed by proper education and training, is key to harnessing this demographic dividend.

Government Support 

India's commitment to the semiconductor industry is supported by substantial government subsidies. A $10 billion subsidy for the sector has already been provided, and there are indications that this could be doubled in the near future. This consistent and regular effort by the government is a cornerstone of India’s strategy.

Source: Times of India

A strong focus on STEM 

India is making considerable strides in STEM education, which is essential for developing a skilled workforce. Moreover, India is actively developing and protecting its intellectual properties (IPs), creating a secure environment for innovation.

India offers the cheapest data availability globally, which is a significant advantage for tech-driven industries. The surge in startups focused on technology and AI demonstrates India's capability and confidence in leveraging these advancements effectively.

Thriving chip design ecosystem 

India already generates $33 billion in revenue from chip design, producing 3,000 chips annually. 

Promising manufacturing setups 

Current manufacturing setups in India are promising, and the potential to explore new avenues and fully utilize fabs remains a key focus. The panelists stressed that maximizing the potential of these facilities is crucial for India's semiconductor ambitions.

The Global Chip Chase: Is India Falling Behind? 

While India has significant potential in semiconductors, there are numerous challenges that need to be addressed to realize this potential fully.

Build up a conducive ecosystem 

While design centers are vital, India must look beyond and aim to build a comprehensive ecosystem that includes manufacturing, research and development, and end-to-end solutions. We need to shift our focus towards product design. 

India also needs to develop expertise in handling new technologies and processes, such as controlling toxic gases and vacuum technology, which are relatively new to the country.

Additionally, enhancing local demand is essential, as sustained demand will attract and retain global companies.

Limited time 

The panelists pointed out that India does not have the luxury of a slow learning curve. To remain competitive, it is imperative to accelerate learning and development in all facets of the semicon industry, from design to manufacturing.

Getting the right mindset in place

Indian youth has a prevailing attitude towards employment. There is a need for a cultural shift where individuals aspire not just for employment but also for creating employment opportunities. 

Encouraging innovation and entrepreneurial thinking is essential for this transformation.

India needs to transition from wealth transfer to wealth creation. Historically, the country has seen short-lived booms in various sectors, including semiconductors, only to fall back on outsourcing. A consistent long-term approach is required to break this cycle.

Another point made was that while India excels in backend work such as IT and design, there is a gap when it comes to hardware and innovative problem-solving. This gap needs to be bridged to ensure India can compete globally in all aspects of semicon technology.

Source: Chetan Patil

Learn from other success stories 

India has achieved success in sectors like electric vehicles (EVs), often without significant government support. Leveraging the knowledge and experience gained from these successes can help in addressing the challenges faced in the semiconductor industry.

Insufficient funding

The financial investment required to compete globally is substantial. The panelists pointed out that even $100 billion is seemingly not enough for the USA and Europe to catch up to Taiwan. 

Thus, India’s $10-20 billion investment needs to be strategically utilized to maximize impact. And it’s not going to be easy. 

Skilling Up for Success

Developing a strong semiconductor industry in India requires not only infrastructure and investment but also a well-trained local talent pool. But how?

Expanding beyond Tier 1 cities

Currently, the talent pool is concentrated in Tier 1 cities, but there is a significant opportunity to tap into the potential of Tier 2 and Tier 3 cities. 
While there is willingness from both industry and academia, the necessary skills are often lacking. Expanding educational initiatives and training programs to these areas is crucial for broadening the talent base.

Aligning academia with industry needs

There is a critical need for academic institutions to understand and align with industry requirements. 

The launch of the C2S (Chips to Startup) program by the government is a significant step in preparing industry-ready skills. However, more needs to be done to ensure that graduates are equipped with the practical knowledge and skills demanded.

Hands-on experience

Many universities have started hosting innovation hubs and centers of excellence (CoE) on their campuses. These initiatives invite industry to play an active role with students, providing them with exposure to real-world challenges and fostering a culture of innovation. 

There is also a notable shortage of semiconductor manufacturing training in India. One innovative suggestion discussed was the use of AR/VR training modules, which can provide hands-on experience without the need for physical presence in specialized facilities. 

Implementing such advanced training methods can enhance the learning experience and better prepare students for industry demands.

Learning from global models

India can learn from successful models in the USA, Europe, and Taiwan, where PhD students spend the first two years on campus and the remaining years working directly in the industry. 

This model ensures that students gain both theoretical knowledge and practical experience, making them more industry-ready upon graduation.

Leveraging ‘Reverse Brain Drain’

As India ramps up its semiconductor manufacturing capabilities, a crucial factor for success will be attracting global talent and encouraging the return of NRIs with valuable experience. 

The panelists discussed the dynamics of reverse brain drain and the importance of bringing back seasoned professionals to strengthen India’s position globally. 

The Return of Global Talent 

With the establishment of new fabs, the question arises: will global talent want to return to India? 

The panelists believe that India has the potential to become a significant hub for semiconductor talent, addressing not only its own needs but also contributing to the global talent pool. 

The increasing number of fabs and multinational companies setting up operations in India could act as a magnet for skilled professionals worldwide.

Reversing the Brain Drain: Bringing back the best

Currently, most returning NRIs are in a cooling-off phase, typically seeking a slower pace after high-intensity careers abroad. However, India’s semiconductor industry needs the opposite—dynamic leaders in the prime of their careers who can drive innovation and growth.

 The panel emphasized that this industry is not suited for freshers; it requires experienced, senior talent who can bring in-depth knowledge and hands-on expertise to the table. These experts can mentor local talent, lead cutting-edge projects, and contribute significantly to the industry's growth.

Building a conducive environment

Creating an environment that attracts and retains top-tier global talent involves offering competitive benefits, career growth opportunities, and a supportive ecosystem. India's growing focus on developing robust infrastructure, coupled with initiatives to support returning professionals, is a step in the right direction. 

By positioning itself as a viable and attractive destination for semiconductor talent, India can reverse the brain drain and bring back its brightest minds.

Shaping the Future of Semiconductors, One Conversation at a Time

The conversation with these industry leaders painted a bright picture of India's potential in the semiconductor space. 

It's a journey filled with both challenges and immense opportunities.  From the need to nurture a skilled workforce to the importance of fostering a culture of innovation, the panelists provided valuable insights into the crucial steps India must take to become a global leader. This open dialogue between industry veterans highlighted the kind of collaboration that will be essential for India's success.  

Here at GTX, we've had the privilege of supporting numerous semiconductor giants in India in their quest for innovation.  We understand the critical role talent plays in this industry, and we're passionate about connecting companies with the top tech minds from around the globe.  By building diverse and skilled teams, we can collectively push the boundaries of what's possible. 

The future is bright, and India’s story is just beginning. Don’t miss out on the ride.