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Three things in Indian semicon: Vinay Shenoy

April 2, 2014 Comments off

Vinay Shenoy

Vinay Shenoy

There have been a variety of announcements made by the Government of India in the last one year or so. In the pre-90s period, the country showed just 1 percent GDP growth rate. It was adverse to FDI and had a regulated market. All of this led to deregulation under the late PM, PV Narasimha Rao.

The Indian government was averse to foreign investment, which was opened up around 1994. Since then, we have seen 6-8 percent growth, said Vinay Shenoy, MD, Infineon Technologies (India). He was delivering the keynote at the UVM 1.2 day, being held in Bangalore, India.

Around 1997, India signed the ITA-1 with the WTO. Lot of electronic items had their import duty reduced to zero. It effectively destroyed the electronics manufacturing industry in India. We were now reduced to being a user of screwdriver technology. In 1985, the National Computer Policy, and in 1986, the National Software Policy, were drafted. The government of India believed that there existed some opportunities. The STPI was also created, as well as 100 percent EoUs. So far, we have been very successful in services, but have a huge deficit on manufacturing.

We made an attempt to kick off semicon manufacturing in 2007, but that didn’t take off for several reasons. It was later revived in 2011-12. Under the latest national policy of electronics, there have been a couple announcements – one, setting up of two semicon fabs in India. The capital grant – nearly 25-27 percent — is being given by the government. It has provided a financial incentive – of about $2 billion.

Two, electronics manufacturing per se, unless it is completely an EoU, the semicon industry will find it difficult to survive. There is the M-SIPS package that offers 25 percent capital grant to a wide range of industries.

Three, we have granted some incentives for manufacturing. But, how are you going to sell? The government has also proposed ‘Made in India’, where, 30 percent of the products will be used within India. These will largely be in the government procurements, so that the BoM should be at least 30 percent from India. The preferential market policy applies to all segments, except defense.

Skill development is also key. The government has clearly stated that there should be innovation-led manufacturing. The government also wants to develop PhDs in selected domains. It intends to provide better lab facilities, better professors, etc. Also, young professors seeking to expand, can seek funding from the government.

TSMC promotes small IP companies. Similarly, it should be done in India. For semicon, these two fabs in India will likely come up in two-three years time. “Look at how you can partner with these fabs. Your interest in the semicon industry will be highly critical. The concern of the industry has been the stability of the tax regime. The government of India has assured 10 years of stable tax regime. The returns will come in 10-15 years,” added Shenoy.

The government has set up electronics manufacturing clusters (EMC). These will make it easy for helping companies to set up within the EMC. The NSDC is tying up with universities in bringing skill-sets. The industry is also defining what skills will be required. The government is funding PhDs, to pursue specialization.

India’s evolving importance to future of fabless: Dr. Wally Rhines

February 3, 2014 2 comments

Dr. Wally RhinesIf I correctly remember, sometime in Oct. 2008, S. Janakiraman, then chairman of the India Semiconductor Association, had proclaimed that despite not having fabs, the ‘fabless India” had been shining brightly! Later, in August 2011, I had written an article on whether India was keen on going the fabless way! Today, at the IESA Vision Summit in Bangalore, Dr, Wally Rhines repeated nearly the same lines!

While the number of new fabless startups has declined substantially in the West during the past decade, they are growing in India, said Dr. Walden C. Rhines, chairman and CEO, during his presentation “Next Steps for the Indian Semiconductor Industry” at the ongoing IESA Vision Summit 2014.

India has key capabilities to stimulate growth of semiconductor companies, which include design services companies, design engineering expertise and innovation, returning entrepreneurs, and educational system. Direct interaction with equipment/systems companies will complete the product development process.

Off the top 50 semicon companies in 2012, 13 are fabless and four are foundries. The global fabless IC market is likely to grow 29 percent in 2013. The fabless IC revenue also continues to grow, reaching about $78.1 billion in 2013.  The fabless revenue is highly concentrated with the top 10 companies likely to account for 64 percent revenue in 2013. As of 2012, the GSA estimates that there aere 1,011 fabless companies.

The semiconductor IP (SIP) market has also been growing and is likely to reach $4,774 million by 2020, growing at a CAGR of 10 percent. The top 10 SIP companies account for 87 percent of the global revenue. Tape-outs at advanced nodes have been growing. However, there are still large large opportunities in older technologies.

IoT will transform industry
It is expected that the Internet of Things (IoT) will transform the semiconductor industry. It is said that in the next 10 years, as many as 100 billion objects could be tied together to form a “central nervous system” for the planet and support highly intelligent web-based systems. As of 2013, 1 trillion devices are connected to the network.

Product differentiation alone makes switching analog/mixed-signal suppliers difficult. Change in strategy toward differentiation gradually raises GPM percentage.

India’s evolving importance to future of fabless
Now, India ranks among the top five semiconductor design locations worldwide. US leads with 507, China with 472, Taiwan with 256, Israel with 150, and India with 120. Some prominent Indian companies are Ineda, Saankhya Labs, Orca Systems and Signal Chip (all fabless) and DXCorr and SilabTech (all SIP).

India is already a leading source of SIP, accounting for 5.3 percent, globally, after USA 43 percent and China 17.3 percent, respectively. It now seems that India has been evolving from design services to fabless powerhouse. India has built a foundation for a fabless future. It now has worldwide leadership with the most influential design teams in the world.

Presently, there are 1,031 MNC R&D centers in India. Next, 18 of the top 20 US semiconductor companies have design centers in India. And, 20 European corporations set up engineering R&D centers in India last year. India also has the richest pool of creative engineering resources and educational institutions in the world. The experience level of Indian engineers has been increasing, but it is still a young and creative workforce. There is also a growing pool of angel investors in India, and also in the West, with strong connections to India.

So, what are the key ingredients to generate a thriving infrastructure? It is involvement and expertise with end equipment. Superb product definition requires the elimination of functional barriers. He gave some examples of foreign “flagged” Indian companies that produced early successes. When users and tool developers work in close proximity, “out-of-the-Box” architectural innovations revolutionize design verification.

What should India do to boost electronics manufacturing?

February 3, 2014 Comments off

The IESA 2014 Vision Summit opened today in Bangalore, with the one key question: what does India need to do to boost electronics manufacturing? Here are some words of wisdom from some industry icons.

SR Patil

SR Patil

SR Patil, Minister for IT-BT, Science and Technology, Karnataka, remarked that at present, we are not able to find any significant place in global hardware arena. We are heavily dependent on other countries to import electronic goods – that may be computers, chips, mobile phones and the list goes on.

“If I am right, our import bill of electronic goods has surpassed $30 billion previous year. It is calculated to be $42 billion by next year if we don’t initiate sincere measures to boost the domestic manufacturing. I don’t have any hesitation to say that we must learn lessons from small countries such as South Korea, Taiwan and Israel on this count.”

The main objective of the Karnataka ESDM policy is to make the state a preferred destination for ESDM investment, and emerge as the ESDM leader in the country.

Patil said: “We aim to generate around 2.4 lakh jobs and 20 percent of the country’s total ESDM export target of $80 billion by the year 2020. We are preparing a ground for setting up of ESDM clusters – both that of Brownfield and Greenfield.”

As many eight ESDM companies have registered with the IT-BT Department recently and obviously they are entitled for various incentives and concessions under the new policy.

Dr. Om Nalamasu, senior VP and CTO, Applied Materials Inc. added that establishing a high-value manufacturing industry as semiconductor chip fabrication will have transformative effect on the overall electronics industry in India.

This will have a very strong multiplier effect that will result in major strides forward in the value generated from all sectors within the semiconductor ecosystem – one of the biggest being the growth of high-tech and high value-add employment opportunities this will generate in the country. The historic significance of this approval will be felt for many years to come. Manufacturing in India will soon witness a new frontier.

A strong manufacturing base is critical for high-growth economies. There are successful examples in South East Asia where advanced manufacturing has resulted in strong GDP multipliers. In India, there’s a strong electronics market opportunity, driven by telecom, IT, consumer and industrial electronics; 65 percent of these electronic products are imported today. The disposable income of the growing middle class in India and China will continue to drive electronics market growth.

The point is: all of these words have been spoken over and over again! The first semicon policy was announced in 2007-08, followed by a revised policy in 2010-11. In between, the first Karnataka semicon policy was announced. However, there have been very, very few, or no takers! Even the first semicon fab policy announcement went unaccounted for! Later, last year, there was another announcement regarding two fabs that are said to be coming up!

When will India deliver? One hopes that happens soon!

Round-up 2013: Best of semiconductors, electronics and solar

December 31, 2013 Comments off

Virtex UltraScale device.

Virtex UltraScale device.

Friends, here’s a review of 2013! There have been the usual hits and misses, globally, while in India, the electronics and semiconductor industries really need to do a lot more! Enjoy, and here’s wishing everyone a Very Happy and Prosperous 2014! Be safe and stay safe!!

DEC. 2013
What does it take to create Silicon Valley!

How’s global semicon industry performing in sub-20nm era?

Xilinx announces 20nm All Programmable UltraSCALE portfolio

Dr. Wally Rhines: Watch out for 14/16nm technologies in 2014!

Outlook 2014: Xilinx bets big on 28nm

NOV. 2013
Indian electronics scenario still dull: Leaptech

Connecting intelligence today for connected world: ARM

India poses huge opportunity for DLP: TI

SEMICON Europa 2013: Where does Europe stand in 450mm path?

OCT. 2013
Apple’s done it again, wth iPad Air!

IEF 2013: New markets and opportunities in sub-20nm era!

SEPT. 2013
ST intros STM32F4 series high-performance Cortex-M4 MCUs

Great, India’s having fabs! But, is the tech choice right?

G450C

G450C

Now, India to have two semicon fabs!

Higher levels of abstraction growth area for EDA

AUG. 2013
Moore’s Law could come to an end within next decade: POET

What’s happening with 450mm: G450C update and status

300mm is the new 200mm!

JULY 2013
Xilinx tapes-out first UltraScale ASIC-class programmable architecture

JUNE 2013
EC’s goal: Reach 20 percent share in chip manufacturing by 2020!
Read more…

Great, India’s having fabs! But, is the tech choice right?

September 13, 2013 2 comments

G450C

G450C

The government of India recently approved the setting up of two semiconductor wafer fabrication facilities in the country. It is expected to provide a major boost to the Indian electronics system design and manufacturing (ESDM) ecosystem. A look at the two proposals:

Jaiprakash Associates, along with IBM (USA) and Tower Jazz (Israel). The outlay of the proposed fab is about Rs. 26,300 crore for establishing the fab facility of 40,000 wafer starts per month of 300mm size, using advanced CMOS technology. Technology nodes proposed are 90nm, 65nm and 45nm nodes in phase I, 28nm node in phase II with the option of establishing a 22nm node in phase III. The proposed location is Greater Noida.

Hindustan Semiconductor Manufacturing Corp. (HSMC) along with ST Microelectronics (France/Italy) and Silterra (Malaysia). The outlay of the proposed fab is about Rs. 25,250 crore for the fab facility of 40,000 wafer starts per month of 300mm size, using advanced CMOS technology. Technology nodes proposed are 90nm, 65nm and 45nm nodes in phase I and 45nm, 28nm and 22nm nodes in phase II. The proposed location is Prantij, near Gandhinagar, Gujarat.

Now, this is excellent news for everyone interested in the Indian semiconductor industry.

One look at the numbers above tell me – NONE OF THESE are going to be 450mm fabs! Indeed, both will be 300mm fabs! After waiting for such a long time to even get passed by the Union Cabinet, are these 300mm fabs going to be enough for India? Is the technology choice even right for the upcoming wafer fabs in India? Let’s examine!

As you can probably see, both the projects have placed 22nm right at the very last phase! That’s very interesting!

Intel just showcased its Xeon processor E5-2600 v2 product family a few days back. I distinctly remember Intel’s Narendra Bhandari showing off the 22nm wafer sometime last week during a product launch!

For discussion’s sake, let’s say, a fab in India comes up by say, early 2015. Let’s assume that Phase 1 takes a full year. Which means, Phase 2, where 22nm node would be used, shall only be touched in 2016 or even beyond! Isn’t it? Where will the rest of the global industry be by then?

You are probably aware of the Global 450 Consortium or G450C, which has Intel, IBM, Samsung, GlobalFoundries and TSMC among its members.  What is the consortium currently doing? It is a 450mm wafer and equipment development program, which is leveraging on the industry and government investments to demonstrate 450mm process capabilities at the CNSE’s Albany Nanotech Complex. CNSE, also a consortium member, is the SUNY’s College of Nanoscale Science and Engineering!

So, what does all of this tell me?

One, these upcoming fabs in India will probably produce low- to mid-range chips, and some high-end ones at a later stage. Well, two, this does raise a question or two about India’s competitive advantage in the wafer fab space!  Three, there is lot of material on 450mm fabs, and some of that is available right here, on this blog! Have the Indian semiconductor industry folks paid enough attention to all that? I really have no idea!

Four, only the newer 300mm fabs built with higher ceilings and stronger floors will be able to be upgraded to 450mm, as presented by The Information Network’s Dr. Robert Castellano at the Semicon West 2013. Five, what are the likely alternative markets for 200mm and 300mm fabs? These are said to be MEMs and TSV, LEDs and solar PV. Alright, stop!

Perhaps, these product lines will be good for India and serve well, for now, but not for long!

Now, India to have two semicon fabs!

September 12, 2013 10 comments

Finally, the Government of India has approved the establishment of a semiconductor wafer fab (fab) in India!

This is indeed heart warming news, especially for the Indian semiconductor and electronics industries. For years, India has been trying to get at least one fab up and running! Now, the dream is about to be realized!

Speaking from China, an ecstatic BV Naidu, chairman and managing director, Sagitaur Ventures, co-chairman, Karnataka ICT Grioup and former president, India Semiconductor Association (ISA) said: “This is really a fantastic news for the Indian semiconductor industry. The government has been trying to achieve this since 2008. The announcement goes as a strong signal to global community.”

Pradip Dutta, corporate VP and MD, Synopsys, said: “It is a momentous decision for the semiconductor industry and by extension the electronics industry for our country. It should lead to a level playing field for the local manufacturers and mitigate some of the disability factors. I sincerely hope the industry reacts positively to this news and this leads to a vibrant local IC design industry.”

Raghu Panicker, sales director, Mentor Graphics India, added: “For years, India has been trying to get at least one fab up and running! This has indeed been a long awaited news. Finally its not ONE, but TWO. The fabs would fuel the growth of semicon start up’s and electronics industry as a whole. It is a big step forward for the overall ESDM inititaive by IESA and government.”

Jaypee Group, IBM and Tower form one consortium. HSMC, STMicroelectronics and a Malaysian company are said to be part of the other consortium.

Union budget 2013-14: Is there some hope for semiconductors?

February 28, 2013 8 comments

Here are highlights of the Union budget 2013-14 presented by P. Chidambaram, union Finance minister, Government of India. Also, is there finally, some hope for the Indian semiconductor industry?

Highlights

* Doing business with India should be easy, friendly and helpful.
* Foreign investments must be encouraged.
* Accelerating growth is the main goal.
* Need to encourage FDI in consonance with economic priorities.
* To target $1 trillion in infrastructure in the 12th plan.
* There are incentives for semiconductor wafer fab manufacturing.
* There will be appropriate incentives for the semiconductors industry, including zero customs duty on plants and machineries.

* To increase allocation for science and atomic departments.
* Indian Institute of BioTechnology to be set up at Ranchi.
* Non-conventional wind energy sector needs help.
* Will encourage cities to take up waste-energy projects through PPPs.
* Plan being developed for Chennai-Bangalore industrial corridor.
* Preparatory work started for Bengalooru-Mumbai Industrial Corridor.
* To launch two new industrial cities in Gujarat and Maharashtra.
* Propose to continue with the Technology Upgradation funds scheme for the textile sector.
* India’s first women’s public sector bank to be set up.
* Woman’s bank license to be in place by October, 2013.
* All PSU banks branches to have ATMs by March, 2014.
* Zero customs duty for electrical plants and machinery proposed.
* Higher customs duty on set-top boxes.
* To provide more than Rs 4200 crore for medical studies.
* To allocate Rs 1106 crore for alternative medicine industry.
* To allocate 100 crores to AMU, BHU, TISS-Guwahati and INTACH.
* Government to set up National Institute of Sports Coaches in Patiala.
* To expand private FM radio to 294 cities.
* To auction 839 licenses for FM network to cover all India.
* Government to construct power transmission system from Srinagar to Leh at the cost of Rs 1,840 crore, Rs 226 crore provided in current budget.
* Mobile phones priced more than Rs. 2,000 will see duty raised by 6 percent.
* Extend tax benefit to electrical vehicles.
* A company investing Rs 100 crore or more in plant and machinery in April 1, 2013 to March 31, 2015 will be allowed 15 percent investment deduction allowance apart from depreciation.
* SEBI to simplify KYC norms governing foreign investors.
* SEBI will simplify procedures for entry of foreign portfolio investors to invest in India.
* Higher outlay on waste management.
* Government to monitor cost of doing business in India.
* Zero customs duty proposed for electrical plants and machinery.
* Proposal to provide Rs. 800 crore for the Ministry of New & Renewable Energy for generation-based incentive for wind energy projects as the non-conventional wind energy sector deserves incentives.
* Government will provide low interest bearing funds from the National Clean Energy Fund (NCEF) to IREDA to on-lend to viable renewable energy projects. The scheme will have a life span of five years.
* Proposal to set apart Rs. 2,000 crore and asked the National Innovation Council to formulate a scheme for the management and application of the fund.

Coming to semiconductors, the world today is discussing the viability of 450mm fabs. I am well aware that Malcolm Penn has been pushing for 450mm fabs across Europe. I believe that one such fab will cost in the excess of $25 billion, if not more. So, who will invest that kind of money in India? Do we have clean water and 24-hour electricity supply in any state that’s required for such a fab? What will this so-called 450mm fab manufacture? Does the fab have a blueprint in place? Well, have we even addressed any of these questions?

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