Government planning semiconductor design-linked incentive policy

NEW DELHI: The government is planning to come up with a semiconductor design-linked incentive policy to promote domestic manufacturing as well as attract global electronic chip companies to the country, according to an official source.

Global majors such as Qualcomm, Intel, Mediatek, Infineon, and Texas Instruments have their research and development in India which contribute in the development of their chipsets.

“The government is deliberating on a new semiconductor design-linked incentive scheme which envisages financial and infrastructure support for Indian MSMEs and startups right through the ideate stage to production stage. As and when these startups start producing and selling chips in the market, they shall also avail additional incentives under the scheme on their net sales turnover,” an official source told PTI.

Minister of state for electronics and IT Rajeev Chandrasekhar last week had said that the government would host a conference of semiconductor companies in November to discuss India’s policy roadmap in the segment.

“It is a great initiative which will leverage India’s strength to make an impact in the field of design of semiconductors. We can target to have 25 plus fabless companies in the next few years which will make a substantial impact in the global semiconductor market,” industry body IESA chairman Rajeev Khushu said.

The semiconductor design is the main driver of revenues that electronic chip companies earn from sale of their high end components.

India is fast approaching the over two-decade-old dream of having semiconductor fabrication units in the country. Bullish about having fabrication units along with the semiconductor ecosystem in India in the next five years, the government is committed to making very strong policy efforts to make it happen.

“Some of these policies for the policy measures have already been taken, some of them I am not at the liberty to disclose at this time. But I can assure you that going into next year, we’ll see the support that has not been there earlier. We will look at a new chapter in electronic manufacturing through Atmanirbhar Bharat,” said Saurabh Gaur, IAS, Joint Secretary in the Ministry of

Electronics & Information Technology (MeitY), while speaking at the 16th edition of IESA’s Vision Summit.

The summit is said to be India’s gateway to the global Electronics Systems Design & Manufacturing (ESDM) ecosystem. This decade is believed to be the defining one for India’s ESDM industry, which will contribute to about 20 per cent of India’s projected $5 trillion economy and is poised to play a significant part in GDP and employment growth.

While India is still years away from semiconductor fabrication, a lot of global companies already have their design houses in the country, with India contributing to almost 20% of global design capabilities.

“We, in the ministry, dream India of holding IP and design capabilities. So while Indians work in global companies and contribute to the growth of industry, Indian companies should also emerge in the design segment,” Gaur added.