“Chipmaking: India needs high investment and political will”

Set to make a foray into manufacturing and manufacturing of semiconductor chips, the country – in addition to sustained investments in high capital expenditure – will also need strong political will and the right partners in the scale to ensure the plan’s success, Sanjay Gupta, India’s managing director and vice president of NXP Semiconductors, said in an interview with Aashish Aryan. Edited excerpts:

There have also been plans in the past for manufacturing semiconductors. They didn’t work. As an industry leader, what do you think is different this time around?

A big difference is that the industry this time is kept informed of important decisions. At every critical moment, they keep us involved, whether on decisions, suggestions. The creation of the India Semiconductor Mission was one of the suggestions of an industry body and it was done. The government has been receptive to new ideas this time around.

What are the three main challenges facing India’s semiconductor mission?

Manufacturing semiconductors is an almost impossible goal. I say it’s almost impossible because, of the approximately 200 countries, only a handful have the capability to manufacture semiconductors at a high level. So, it must be something extremely difficult, otherwise everyone would have done it easily.

The barrier to entry into the industry is one of the biggest challenges. No industry matches the type of investment required for semiconductor manufacturing. It is a capital-intensive investment and, that too, long-term. It has to be patiently performed for several years before any results begin to arrive. We are talking about a multi-billion dollar investment in manufacturing units. So you need the right partners who have patience and the right vision for the long-term mission.

The second is that being a very specialized technology company, the talent base in the world is very limited. If we talk about the number of semiconductor experts in the country, it will be a handful of Indians who have deep knowledge of the industry accumulated over decades.

The story is the same when it comes to finding talent in semiconductor design. Although India is the largest country supplying semiconductor talent to all major companies in the world, the reality is that the global talent base for this industry is very small. The availability of talent is the second challenge.

The third challenge is to expand the plan and put the right foundations in place. Skill India and Startup India will be very important for India to acquire the theoretical and practical knowledge. India has no shortage of talent in semiconductor design. I can’t think of a country that doesn’t have a design space in India.

Another challenge, apart from these, is political will. Such a massive effort requires the involvement of the masses and the government must take this initiative.

Does government assurance to provide support for semiconductor talent help when it comes to talent?

If you need to build a toy from 10 Lego blocks and only two are in the right place and no one is working on the rest of the eight blocks, you are working in isolation. Some of the siled activities would be successful, but overall, as a project, they would fail. This was the case in India in the past. Today, all stakeholders have a common goal.

This will result in great success in the time to come.

Would NXP be open to investing in India?

Multi-billion dollar investments are very crucial for any business. The Indian government has reached out to us and we are discussing it at different levels. India is one of the largest design centers for NXP in the world. We have approximately 3,000 engineers working across our four locations: Noida, Pune, Bangalore and Hyderabad. Everyone is working on advanced technologies.

As long as we continue to innovate and deliver, we will continue to grow, both as a design center and as a country.

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