Robust fab ecosystem key to India realising full promise

India's growing semiconductor industry holds immense potential. Having a robust fabrication ecosystem is key to realising its full promise.

- Pradeep Chakraborty

This is an opportunity for India, and has multiple challenges. The keywords here are: design thinking, system thinking, and end-to-end thinking. We are now talking about a fab. A fab is a small part of the value chain. We now need to be able to design better, and also make an end product. Thanks to the presence of the multinational companies in India, especially, Bangalore, Indian engineers have been able to develop certain necessary skillsets in chip design and verification.

There are three reasons for fabs. The first is the patriotic reason. It will be a proud moment for India to proclaim that it now has semiconductor fabs coming up. Next, is the strategic reason, and supply chain imbalance. India has been lacking fabs so far. By having fabs, India can bridge that gap. We also now need to then look at supply chain imbalance and perhaps, address that. Given the global outpourings against China, we need to relook closer, and hopefully, better, at the supply chain.

WHO HAVE WE JOINED?

The third is the economic value that a fab can bring. We will now join the likes of Taiwan, Japan, South Korea, China, Singapore, Malaysia, Vietnam, Thailand, Hong Kong, The Philippines, etc. Indonesia has the strategic advantage of having abundant raw materials. Indonesia is also rich in silica sand, a critical component in production of silicon wafers and, consequently, semiconductors.

Indonesia is a chokepoint in the global supply chain for raw materials and semiconductor assembly, testing and packaging (ATP). It finds itself in the same niche as Malaysia and Vietnam, both of whom are more advanced in this sector. In the Middle East, we have fabs in Israel, Saudi Arabia.