ANI
25 Mar 2025, 09:02 GMT+10
New Delhi [India], March 25 (ANI): India's semiconductor industry is growing but faces significant challenges such as an underdeveloped supply chain, a shortage of specialized manufacturing talent, global competition, and rapidly evolving technology, according to a report by Jefferies.
The report highlighted that while India has several key advantages, including a strong engineering talent pool and government support, it must overcome hurdles to establish a competitive semiconductor ecosystem.
It said, 'The industry also needs to navigate through the challenges of an undeveloped supply chain, limited specialized manufacturing talent, stiff global competition, and rapidly evolving technology.'
One of the biggest challenges is the limited availability of key raw materials like silicon wafers, high-purity gases, specialty chemicals, and ultrapure water, which are essential for chip manufacturing.
While India has a well-developed chemical and gas manufacturing sector, particularly in regions like Dahej in Gujarat, companies still need to enhance their capabilities to produce semiconductor-grade raw materials. The government has prioritized the development of the full semiconductor supply chain, including chemicals, gases, and equipment, to reduce dependency on imports.
India is home to nearly 20 per cent of the global semiconductor design workforce, demonstrating its strength in chip design. However, there is a gap in specialized skills required for semiconductor fabrication and testing.
To address this, the report stated that companies are working on skill development, and the government is collaborating with industries and universities to create courses tailored to semiconductor manufacturing, assembly, and testing.
The report also pointed out that India faces tough competition from well-established semiconductor hubs such as China, Singapore, Malaysia, South Korea, and Taiwan, which have spent decades building their ecosystems.
With the rising strategic importance of semiconductors and the increasing focus on supply chain security, many countries are offering subsidies and incentives to attract chip manufacturers.
India has taken steps to attract investments by offering large incentives, which have helped initiate semiconductor manufacturing projects.
However, setting up advanced fabrication facilities comes with risks, including initial production challenges, quality control issues, and achieving economies of scale. The success of India's semiconductor industry will depend on securing long-term demand for chips, both domestically and in export markets.
Another major challenge is keeping up with rapid technological advancements. While India is still in the process of setting up its first fabrication facility, global semiconductor companies are continuously pushing the limits of chip miniaturization. As a late entrant, India may have to make significant capital investments to remain competitive.
Despite these challenges, India's semiconductor industry has the potential to grow with strong government support, industry collaborations, and investments in research and development. Establishing a complete semiconductor ecosystem will be crucial for India to become a major player in the global chip industry. (ANI)
Get a daily dose of India Gazette news through our daily email, its complimentary and keeps you fully up to date with world and business news as well.
Publish news of your business, community or sports group, personnel appointments, major event and more by submitting a news release to India Gazette.
More InformationNEW YORK, New York - Investors bought up stocks on U.S. markets Monday after President Donald Trump indicated he may pull back on some...
BOSTON, Massachusetts: Private equity investor William Chisholm has agreed to buy the Boston Celtics in a record-breaking deal worth...
WASHINGTON, D.C.: The cost of borrowing for a home in the U.S. ticked up again this week, marking the second straight increase as homebuyers...
CUPERTINO, CALIFORNIA: Apple's ambitious foray into streaming is proving costly, with the company reportedly losing over US$1 billion...
NEW YORK CITY, New York: Gold's record-breaking rally is expected to continue, with Citi Research increasing its three-month price...
BOSTON, Massachusetts: A routine safety mechanism at data centers nearly triggered a regional power crisis last summer, highlighting...
Having reported for months from Donbass, TV9 editor Manish Jha shared his perspective of covering the conflict with RT ...
New Delhi [India], March 25 (ANI): The Reserve Bank of India (RBI) has made it clear that banks cannot impose excessive charges, particularly...
By Sahil Kohli Ahmedabad (Gujarat) [India], March 25 (ANI): Ahead of his side's Indian Premier League (IPL) opener against Gujarat...
New Delhi [India], March 25 (ANI): India's semiconductor industry is growing but faces significant challenges such as an underdeveloped...
New Delhi [India], March 25 (ANI): The BJP-led Delhi government is set to present the Budget 2025-26, its first Budget in 26 years...
Mumbai (Maharashtra) [India], March 25 (ANI): Mumbai Youth Congress President Akhilesh Yadav called for the resignation of Maharashtra...