Friday, October 1, 2010

What’s the way forward for Indian semicon/ESDM industry?

Recently, a panel discussion was held on the “Semiconductor evolution in India – Past, Present and Future,” at a conference in Bangalore.

Two eminent industry friends — Dr. Satya Gupta, co-founder and CEO, Concept2Silicon Systems and Rahul Arya, director, marketing and technology sales, Cadence Design Systems, were among the panelists.

Both of them attempted to provide a way forward for the Indian semiconductor (and ESDM) industry. Here’s a snapshot of their take on the evolution of the Indian semiconductor industry — from the past to the present, and the way ahead!

System level product definition required
Regarding the growth of semiconductors in India, Dr. Satya Gupta of Concept2Silicon, said that the past focused on design services and resource augmentation. The present day scenario is more toward design implementation and ownership, and some amount of product definition.

He advised that the future should be toward system level product definition, product marketing, and system design and manufacturing.

Dr Gupta raised some other points. One, critical decision making is required for product definition by small number of highly experienced domain and market experts. Two, several government schemes exist for financial support for SMEs and start-ups for technology development and innovation in the semiconductor and electronics system design and manufacturing (ESDM) spaces.

The India Semiconductor Association (ISA) is said to be working with government and other industry bodies to foster growth of ESDM market and products made in India, he added.

Dr. Gupta highlighted the importance of the availability of quality components in a timely fashion and at competitive pricing, which would be required to help ESDM companies. Further, effective use of the infrastructure available is also needed to create talent with the necessary experience in VLSI and system design.

Innovation brewing in tech, business
Presenting his snapshot on the evolution of the Indian semiconductor industry, Rahul Arya of Cadence Design Systems, said that in the past, India had moved from being an optimizer, to an enabler, on to being a co-inventor over the last 25 years. India started with cost arbitrage and experimentation. Liberalization in the 1990s and globalization helped.

When companies worldwide were trying to meet the productivity and time-to-market window, Indian design centers and services companies enabled growth. TI and Cadence were the early entrants in India. Over a period of time, the various India design centers built their credibility through relentless execution and developed expertise.

Now, India is on a growth trajectory. The local telecom market has arrived and what happens in this segment will be defining in some ways, the way forward. Arya said innovations are now brewing in technology and business models. Companies are now vying for share in local and global markets.

The way forward
So, what is the way forward? According to Arya, the mindset should change from fabless chip design to product design. Infotainment, telecom, defense and space will be the growth drivers.

The brain drain – or the reverse brain drain, which he calls, the ‘brain gain’, will speed up as companies will hire global experts with domain expertise and business outlook. India has moved from brain drain to reverse brain drain and going forward, it will be ‘brain gain’ wherein companies will hire global experts with domain expertise and business outlook. India can also look forward to an era of collaborations, acquisitions and manufacturing. There will be products conceptualized in India for the ‘glocal’ market.

Home truths
That’s quite an exhaustive wish list! Definitely, ‘brain gain’ is ongoing, as are initiatives to conceptualize products in India for the ‘glocal’ market.

ESDM has been doing the rounds in the sense that there has been a lot of talk about ESDM over the past eight to nine months or so in India. As far as we have been hearing, ESDM seems quite some way off from being a reality today!

The absence of an ecosystem for electronic components in India does not help matters much. How does one expect the Indian semiconductor or ESDM ecosystem to develop in the absence of an ecosystem for electronic components?

One could question here whether the Indian semicon policy or SIPS itself has succeeded. Perhaps, it has not, so far! However, there have been robust advances made in solar photovoltaics (PV), and now, LED lighting activities look to be gaining some momentum. And, these are NOT semicon exactly. Growth of ‘real’ semicon and ESDM are still some way off!

Am certain that the concerned stakeholders are taking further corrective measures regarding India’s semiconductor policy in order to provide the necessary momentum required for the growth of semicon and ESDM activities in India.

And please, do something about electronic components!

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