To build a semiconductor supply chain, who can be more reliable than India?

“The world needs a reliable supply chain, and who could be a more trusted partner than the world’s largest democracy?”

At the opening ceremony of the Semicon India 2023 held on the 28th, facing hundreds of semiconductor industry executives in the audience, Indian Prime Minister Modi worked hard to “sell” India’s “reliable status” as a semiconductor industry base.

India’s “Printing News” introduced that the annual India Semiconductor Forum is a flagship project under the Indian government’s semiconductor industry development strategy. The top executives of chip giants in China were present.

Based on reports from Reuters and Indian media, Modi said on the same day that India has made chip manufacturing a top priority of its economic policy and has continued to carry out policy reforms. He said: “As India continues to move forward on the road of reform, new opportunities will continue to emerge, and India is becoming an excellent conductor of semiconductor investment.”

Modi called for more semiconductor companies to invest in India. He said that at last year’s forum, many people asked why they should invest in India. “Now, the question has become ‘why not invest in India'”. He said that India needs to establish a domestic chip manufacturing ecosystem, “whoever moves quickly in this regard will gain a first-mover advantage.”

According to India’s “Business Standard” report, Modi described in his speech that the Indian government has “rolled out the red carpet” for global semiconductor companies. In his view, India has won the confidence of many investors because India has a “stable, responsible and reform-oriented government”, continuously developing infrastructure and technology, and a huge talent pool.

“Nikkei Asia” mentioned that at a time when China and the United States are fighting to reshape the global chip supply chain, Modi specifically emphasized India’s potential in the current geopolitical context in his speech, and issued the exclamation at the beginning of the article. He said that democracy, population and dividends are the keys to the success of any industry, and India has all three, and investment in India will bring considerable long-term growth returns.

Reuters pointed out that although India entered the semiconductor industry late, the local chip market is expected to reach $80 billion by 2028, almost four times its current size. However, the report also mentioned that although India launched a chip incentive plan worth US$10 billion in 2021, it seems to have limited results so far. So far, no company has been allowed to set up a chip factory there.

In addition, some experts told Nikkei Asia that if India wants to attract more semiconductor companies, it needs to improve infrastructure and human development capital. While top universities such as the Indian Institute of Technology do produce talent for India, many end up in the US and elsewhere overseas.

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