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Indian IC ecosystem ready for takeoff

Posted: 09 May 2008 ?? ?Print Version ?Bookmark and Share

Keywords:India IC industry? semiconductor ecosystem? intellectual property?

Top executives from the Indian and global chip industry believe the semiconductor ecosystem in the country is poised for takeoff. But first, Indian chip developers must build up their repositories of intellectual property (IP) and they also need to collaborate if they hope to play in the global IC market, industry leaders told members of the India Semiconductor Association.

Other changes foreseen by participants in a panel discussion include small-scale local manufacturing of portable electronic products, a trend that could unleash a huge wave of demand for chips. Also, Indian companies will target other countries with similar socioeconomic conditions for their products, while the federal government will intensify its promotion of local electronics manufacturing.

Aart de Geus, chairman and CEO of Synopsys Inc., said that India has been able to build core competence in VLSI, embedded software and board design in a remarkably short period of time.

"This is a phenomenal achievement," said de Geus, who pointed out that 19 of the top 25 semiconductor companies in the world have Indian operations. "But with the state of the global semiconductor industry being what it is now and changes becoming more intense than ever before, companies, including those in India, will have to collaborate with one another," he said.

De Geus called collaboration "the differentiating skill" for chip companies going forward. "But it will not be easy. How to collaborate will be the most difficult choice to make," he said, as managers weigh the right time and the right products for collaboration, and choose the right partners. "How to collaborate is the question that needs to be addressed to get to critical mass," de Geus added.

IP focus
IP must become a focus for Indian chip companies, said Sudip Nandy, CEO for telecom and product-engineering services at Wipro Technologies. Indian design companies need to develop families of IP to continue to be as profitable as they are now. Linear growth in revenue that comes by adding more engineers is not the way to grow any more, he said.

Wipro, for instance, is eyeing domain-based collaborative research to develop more IP and is already looking at tweaking designs so that electronics products can also be made for the Indian market. Also, original design engineering is starting to happen in India, Nandy said.

Biswadip Mitra, managing director of Texas Instruments (India) Ltd, said that while most chip companies were already addressing mainstream, big market segments, most were not aware that small and regional manufacturers of medical and industrial applications together constituted an equally big market.

"India's design industry is growing from strength to strength, but now is also the time for systems engineering [to address under-penetrated markets] to start growing. There are thousands of small companies in medical, industrial, power, automotive and video applications, and they now provide a once-in-a-lifetime opportunity for semiconductor companies," Mitra said.

The seed capital for product companies is not yet easily available in India, while India lags way behind China in electronics manufacturing, behind Taiwan in product engineering and behind Israel in product innovation, said B.V. Naidu, managing director at SemIndia Systems Pvt. Ltd.

"But the upcoming Fab City in Hyderabad, the string of electronics companies that dot Sriperumbudur, near Chennai, and the design skills of Bengaluru will together soon constitute a golden triangle of the Indian electronics industry," he said.

Naidu also pointed to "a long-awaited [government] policy that is expected to specifically encourage OEMs and ODMs to take up manufacturing in the country." When announced, he said, it will "help fill in the gaps in manufacturing that currently exist."

- K.C. Krishnadas
EE Times

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