Why in the News
The next phase of the India Semiconductor Mission is gaining attention due to the growing importance of semiconductors in the global tech economy. Semiconductors are essential components in virtually all modern technology, from smartphones to electric vehicles, making semiconductor manufacturing a critical industry for India’s future technological and economic growth.
The news comes at a time when India is aiming to bolster its domestic manufacturing capabilities for chips, reducing its dependency on global suppliers like Taiwan, South Korea, and the US. The second phase of the ISM seeks to scale up these efforts and tackle challenges like overcapacity and geographic concentration of production.
Introduction to India Semiconductor Mission (ISM)
The India Semiconductor Mission (ISM) was launched by the Indian government with the goal of developing an end-to-end semiconductor ecosystem within India. This is in line with the country’s broader goal of becoming a global hub for advanced technology manufacturing, reducing dependency on foreign imports, and creating employment opportunities in the technology sector.
The first phase of ISM successfully attracted $10 billion in investments for various semiconductor manufacturing projects. The second phase is now focused on addressing the challenges facing the industry, such as advanced packaging, and expanding production capacities to ensure that India can meet the growing demand for semiconductors.
The government is also working on collaborations with international players and boosting domestic R&D, which are essential for creating a sustainable and competitive semiconductor ecosystem. The success of the ISM will not only benefit India’s technological infrastructure but will also play a key role in shaping the global semiconductor supply chain.
- Introduction to the Next Phase of the India Semiconductor Mission (ISM):
- The Indian government is working on the next phase of the India Semiconductor Mission (ISM), with discussions and finalization of the design and outline of the scheme currently underway.
- The mission aims to boost semiconductor manufacturing in India by attracting investments, improving production capabilities, and developing the semiconductor ecosystem in the country.
- Objective of the India Semiconductor Mission (ISM):
- The primary goal of the ISM is to promote semiconductor manufacturing in India, an industry critical to modern electronics, and to reduce the country’s dependency on imports for chips and electronic components.
- Under the first phase of the ISM, investments worth $10 billion were secured to help kickstart India’s semiconductor industry.
- Government’s Role and Support:
- The government plans to provide various forms of support under the second phase of the ISM, including help with raw materials, equipment, and specialty chemicals needed for semiconductor manufacturing.
- There will also be an emphasis on creating a sustainable ecosystem for semiconductor manufacturing in India, focusing on improving value chains and addressing areas of capacity expansion and geographic diversity.
- Key Projects and Investments:
- Tata-PSMC fab and other notable projects have already attracted significant investments, including one worth $1 billion, aimed at building semiconductor manufacturing capacity.
- These investments are part of India’s push to establish itself as a major player in semiconductor manufacturing, especially as the global demand for chips rises.
- Challenges to Address in the Semiconductor Ecosystem:
- Despite investments, the semiconductor industry faces challenges like overcapacity, geographical concentration, and limited innovation in packaging.
- The government’s focus is also on advanced packaging techniques, which are crucial for improving semiconductor production quality and expanding capabilities.
- Future of ISM and Policy Support:
- The government is planning more supportive policy measures, including helping with design and manufacturing to enhance the competitiveness of the sector.
- The success of ISM is critical as it will provide a foundation for building India’s self-reliance in technology and reducing dependency on foreign semiconductor suppliers.
- International Collaboration:
- India is collaborating with several international stakeholders, such as Japan’s Renesas, US-based Micron Technology, and Tata in partnerships to expand semiconductor manufacturing.
- These partnerships aim to bring more advanced technology and knowledge to India’s semiconductor industry.
- Looking Ahead:
- The government is working toward a completely sustainable semiconductor ecosystem, which would involve developing both technical infrastructure and industry-specific expertise.
- Additionally, the government plans to introduce new manufacturing capabilities and innovations to increase global competitiveness.
Explanation of Peculiar Terms
- India Semiconductor Mission (ISM):
- The India Semiconductor Mission (ISM) is a government-led initiative aimed at developing and promoting semiconductor manufacturing in India. This is crucial for creating a self-reliant ecosystem for semiconductors, which are the backbone of most modern electronic devices such as smartphones, computers, and other high-tech gadgets.
- Semiconductor Manufacturing:
- Semiconductors are materials that have conductivity between conductors (like metals) and insulators (like ceramics). They are essential for the production of integrated circuits (ICs) or microchips, which are used in electronics such as computers, mobile phones, and various other gadgets. Manufacturing semiconductors is a complex, high-tech process involving significant research and development (R&D).
- Advanced Packaging:
- Advanced packaging refers to the techniques used to encapsulate semiconductor chips and connect them with other components. This process is crucial because it ensures that the semiconductor chips are protected and function optimally. It involves technologies such as 3D packaging and system-in-package (SiP), which are used to enhance the performance and capabilities of chips.
- Tata-PSMC fab:
- The Tata-PSMC fab is one of the key semiconductor manufacturing facilities being built in India under the India Semiconductor Mission (ISM). The facility is expected to attract investments and develop advanced manufacturing capabilities for semiconductor chips. It is part of India’s broader goal to set up a semiconductor manufacturing ecosystem.
- Renesas and Micron Technology:
- Renesas is a Japanese semiconductor manufacturer, known for producing microcontrollers and integrated circuits. Micron Technology is a US-based company, one of the world’s largest producers of semiconductor solutions, specializing in memory chips and storage devices. Both companies are collaborating with India to bring semiconductor expertise and investments to the country.
- Self-reliance in Technology:
- Self-reliance in technology refers to a country’s ability to develop, manufacture, and innovate in technology without depending on foreign sources. For India, achieving self-reliance in semiconductor manufacturing would be a significant step toward reducing reliance on foreign suppliers, particularly in sectors critical for national security and economic stability.
Conclusion
The India Semiconductor Mission (ISM) represents a bold step towards making India a major player in the semiconductor manufacturing space. With significant government support and strategic international collaborations, the next phase of ISM is expected to tackle challenges such as overcapacity and geographic concentration while introducing advanced packaging techniques and expanding manufacturing capabilities.
For CLAT aspirants, understanding the ISM and its economic implications is essential for the General Knowledge and Current Affairs sections of the exam, as technology policy and economic self-reliance are increasingly becoming critical areas of focus in national and global affairs. The successful implementation of ISM will have lasting impacts on India’s economy, employment, and technology capabilities.
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