I came across a blog written by Deepak Sekar, the Chief Scientist at Monolithic 3D and he makes several interesting points as to how Korea became the De-facto memory hub. The story of Korea in the 1960s and where India is now is uncannily similar. Hopefully, the Indian Government takes lessons from this and formulates a policy that works here. Let’s look at the points Deepak makes and see what could be applicable in the Indian context:
Like Korea in the 1960s, India today is primarily an agrarian economy, in the sense that a majority (70%+) of its populations lives in villages performing farming or related occupations. As the government is tries to move the teeming masses to higher paying occupations, a focused policy to dominate in particular semiconductor manufacturing segments might just be the ticket. Like Korea did it with memories, India could focus on 3D chips or microprocessors or DSPs.
Chaebols and Access to Capital
Chaebols are classical Korean conglomerates often owned by a single family. All old school major Indian businesses have a similar structure – Tata, Birla, Reliance, Mahindra, Videocon to name a few. These business groups for the longest time have been using funds from successful groups companies to start new ventures. It is not inconceivable that they could be goaded or cajoled to start semiconductor manufacturing in a huge way. In fact, Reliance was to enter the Semiconductor manufacturing space, but the plans were shelved after the crash of 2008. If the Indian government as a matter of policy actually gives easy access to capital for forming semiconductor businesses, these Indian Chaebols could step up to the plate and take on the challenge. They certainly have done similar things in the past and this would be no different.
Starting a manufacturing business from scratch requires that you look at brand new cutting edge technologies without any of the baggage of the past. You don’t have to worry whether a legacy technology could be migrated to the new line. Newer technologies with a clean start can allow Indian semiconductor manufacturers to leapfrog external competition that must worry about process node transition and migration. If executed properly, India can take a huge lead in a particular semiconductor space.
Low Cost Manufacturing Location
India is still far cheaper compared to the US, the EU, Japan and even China. Additionally, it has a deep pool of resources who actually know how semiconductors are built. This is an inherent advantage that Korea did not have in the 1960s when they only had lower cost.
In fact, all the ingredients for a perfect storm, low costs, talent, land, capital availability and successful business houses are present. All it needs is policy implementation. Of course, this blog and many others can talk ad nauseam about the Indian semiconductor policy. The question is whether the governments, state of central, act and help bring visions into reality.