SWOT analysis of India's electronics and
semiconductor industry
India has enough resources, capabilities and opportunities
to thrive and lead in electronics and semiconductor industry,
which include design, manufacturing and services(doing everything
in electronics but not owning the end-product). With some
delighting expectations for Indian electronics and semiconductor
industry from the yet-to-be announced Union budget 2010-2011,
here we provide some of our brief observation/study.
Globally, India has achieved number one status in some
sectors of engineering services. Thanks to Wipro, TCS, Mindtree,
Aricent and lot of such electronics design service focused
companies. Their achievement is highly laudable considering
youngness of our electronics industry. The real credit goes
to hardworking and talented engineers. This status needs
to be maintained while getting into manufacturing and design.
India should also be thankful to big daddies of global electronics
industry for outsourcing their design work to Indian companies.
We failed miserably in manufacturing and core design (except
few PSUs). Some of the PSUs like BEL and ECIL have survived
due to their technological capabilities as well as protection
from the Governament. C-DoT was marvelous (nothing wrong
in giving full marks to Sam Pitroda and X-PM Rajiv Gandhi)
in the beginning but later the reason for its failures is
clearly the big problem of Indian telecom industry. If somebody
say we can't make telecom equipments, then have a look at
Tejas Networks; grown by 70% recently.
The basic requirement to succeed in manufacturing and design
is to have leading edge technological capabilities and the
other equally important factor is availability of local
market. Presently India has both. Now, India's own design
and manufacturing will surely happen with the support of
government.
The most essential factor for manufacturing is the availability
of materials i.e. components which includes hundreds of
varieties of electrical and electronics components along
with semiconductor ICs and other precision components. There
is only a thin skeleton of such suppliers in India. This
need to be strengthened by helping struggling passive and
discrete-semi electronic component manufacturers with technology-support
in making the latest components but at competitive prices.
It is more easy to say this than really achieving due to
the stiff competition from China and Taiwan. The CDIL is
a lone discrete semiconductor vendor surviving in the global
market with its base in India. Government and industry bodies
have to identify such companies and provide incentives.
Industry can also look at China and Taiwan as alternate
supplier for some of the components. Smart companies in
India are already doing this. This alternative strategy
is also OK.
The 2nd important factor is the speed of physical goods
movements, so that supplier can deliver the product in-time
faster exactly to the place customer wants. The sea ports,
quick custom clearance, reliable road and reliable transportation
matters here. We are improving here but at slow pace.
Finally the power, water, land required for industry; frequent
power outages, shortage of water supply, bad roads will
never allow Indian electronics industry to scale up to compete
with the leading regions. Most of these above are somewhat
known facts.
The real threat comes from lack of fundamental research:
Why not Indian premier engineering institute can't think
out of the box technology solutions? Why should we follow
the nano meter race? Why can't our research institutes develop
devices, which work totally different from Silicon MOSFETs?
Why not a different material? Why not light source more
efficient than high brightness white LED?Why not a solar
energy converter far more efficient than present thin film
solar cells?
Why not we make our own semiconductor manufacturing equipment?
Why we should always follow the tail of what researchers
at US and Europe does? We should get rid off this herd like
follow up on the technologies developed in the west.
Indian labs should develop disruptive technologies with
economical and business strategy. Few such examples include
Intel-Microsoft partnered PCs and the software, Wireless
telecom developed by European companies. India's Simputer
failed due to bad strategy.
On the academic front, Engineers who can't design and
make a physical product are not worth of their marks they
scored in theory subjects, even if they have scored 80%.
When we look at the market opportunity, if we can imagine,
it's huge. India needs lots of electronics from ECG machines
to solar power systems to mobile phones. Electronics is
now staple, no more a luxury. A white LED lamp lantern can
be cheaper and efficient than oil-lit-lamps. A phone is
essential even to a low income earning person. An electronic
id card is must for every citizen. India's electronics market
is expected to cross $125 billion by 2014 from the present
market of $45 billion and India's semiconductor market is
also expected to grow nearly the same way. The India Semiconductor
Association report states total revenues of the Indian semiconductor
market is expected to reach $7.59 billion in 2010.
National electronic mission now need to be taken up in the
same spirit of how the green revolution was taken few decades
back, but green revolution output has to be maintained.
Infact, electronics technologies need to be blended with
Agriculture/farming technologies to produce healthier food
grains at less cost.
We need our own microprocessor and many such smart electronic
devices and technologies, at least one advanced semiconductor
fab is required. India semiconductor industry as whole can
be a fab-lite( infact very light) but never the fab-les,
that's very risky.
Electronics mission should treat IPs and patents as our
nation's another gold reserve. We should fill this faster.
Awareness drive and incentives from Government is essential.
Finally most important is timing. 2010 to 2020 is the
right decade to etch India in Silicon.
Below is th more related news on India's semiconductor
industry
India
semiconductor revenue to cross $8 billion due to localization
of manufacturing
NXP
Semiconductor's Neeraj hints on India's electronics industry
opportunities
TI;
a company with advantage to serve the Indian semiconductor
market
De
Core to soon produce white LEDs from its opto-semiconductor
fab at Noida
Best
consultants related to India's electronics and semiconductor
industry
India
Semiconductor Association suggests extending India semiconductor
policy to 2015
Karnataka
semiconductor policy recognizes 3 idiots
India
will emerge into leading position in semiconductor market
Semiconductor-manufacturing
investment flow of 23 billion USD into India
Indian
Engineers severely lack exposure to semiconductor manufacturing
India;
the blooming garden for semiconductor industry
SPEL;
India's only semiconductor assembly and test services company
grows by 14%
Wipro
ranked as number-one semiconductor global R&D service provider
India
badly needs a semiconductor fab
