There Must Be Increased Focus and Investment in R&D to Foster Indigenous Semiconductor Design Capabilities

Published  March 6, 2024   0
Ashok Mehta, Managing Director, Suchi Semicon

With the significant incentives and increased budget allocation for the semiconductor industry, India is on the track for remarkable growth in the coming five years. These initiatives will fuel investment in semiconductor manufacturing facilities, research and development, and talent development programs. As a result, India is likely to emerge as a prominent player in the global semiconductor market, competing on both domestic and international fronts. India can 100% compete globally. Two major factors will play a big role in this which India possesses both, Quality and Knowledgeable Manpower and Cost-effective Labor. According to research, the Indian semiconductor market is expected to reach USD 55 billion by 2026. Global companies are already eyeing for procurements from India. In this regard, we spoke to Ashok Mehta, managing director, Suchi Semicon about the current challenges in India's semiconductor industry, how R&D's are playing an important role, the loopholes in the policies, and various other imperative aspects of the industry.

Q. From Textile industry to Silicon, why have you embarked on the semiconductor industry? Being a textile veteran, how are you planning to develop the semiconductor industry in India?

As a veteran in the textile industry transitioning into the semiconductor industry, I recognized the immense potential for growth and innovation in the semiconductor sector. While textiles have been my expertise, I believe that diversifying into the semiconductor industry allows for broader opportunities to contribute to India's technological advancement and economic development. The decision to enter the semiconductor industry was driven by several factors. Firstly, the semiconductor industry is a critical component of today's technology-driven world, powering everything from smartphones and computers to automotive electronics and IoT devices. With India's growing focus on digitalization and technological innovation, the semiconductor industry presents a significant opportunity to contribute to the nation's progress.

Furthermore, my experience in the textile industry has provided me with valuable insights into manufacturing processes, supply chain management, and quality control – all of which are applicable in the semiconductor industry. Leveraging this expertise, I aim to bring efficiency, reliability, and innovation to semiconductor manufacturing in India. In terms of developing the semiconductor industry in India, my approach will be multifaceted. Firstly, I plan to focus on building strategic networks with global semiconductor companies. Secondly, I will prioritize talent development and skill enhancement initiatives to nurture a skilled workforce capable of meeting the demands of the semiconductor industry. This includes collaborating with academic institutions to offer specialized training programs in semiconductor engineering and manufacturing. Overall, my transition from the textile industry to the semiconductor industry represents a strategic move to leverage my expertise and contribute to India's technological growth. Through collaboration, innovation, and investment, I am confident that we can develop a thriving semiconductor industry that contributes significantly to India's economic prosperity and technological advancement.

Q. When you speak of the recent investments and the proposals, the industry is still surrounded with various challenges. For instance, R&D and the design centers are designing chips mostly for other countries. Kindly highlight the grave additional challenges and what are the solutions required?

R&D and Design Centers – India has a very strong hold when it comes to designing of Semiconductors. More than 55,000 People are employed in the design industry for electronics, since there was no packaging facility in India. These packages were designed in India but assembled elsewhere in the world. With the industry growing, there will be a shift in this pattern. The Indian Semiconductor industry will disrupt the global semiconductor supply chain.

Other Challenges

To address the challenges in the Semiconductor Space, solutions are needed at multiple levels. Firstly, there must be increased focus and investment in R&D to foster indigenous semiconductor design capabilities. This includes establishing more design centers, providing incentives for research collaboration between academia and industry, and supporting startups in the semiconductor space. Additionally, efforts should be made to enhance the skill development ecosystem through specialized training programs and partnerships with educational institutions.

Infrastructure development is also crucial, including investment in fabrication facilities and advanced technology nodes. This will reduce dependency on imports and enable domestic production of semiconductor chips. Moreover, streamlining regulatory processes and providing policy support will encourage both domestic and foreign investment in the semiconductor sector.

Furthermore, fostering a conducive ecosystem for innovation and entrepreneurship will encourage the growth of startups and SMEs in semiconductor design and manufacturing. This can be achieved through initiatives such as incubation centers, funding support, and regulatory reforms to ease market entry. Overall, addressing these challenges requires a coordinated effort from government, industry, and academia to nurture a robust semiconductor ecosystem in India and enable the country to compete globally in the semiconductor industry.

Semiconductor Manufacturing Industry

Q. After all the funds allocation and the proposals, do you think India can achieve the target of $55 billion by 2026 and $110 billion by 2030 in semiconductors? Micron is the only global company which is approved and that is also ATMP. We do not have any fabs? Why is it so difficult to set-up fabs in India?

A decade ago, India had only two mobile phone manufacturers. Today, that number has grown to over 200. Simultaneously, internet usage has experienced exponential growth in recent years. Over the past five years, there has been a significant surge in demand for wearables. With these trends in mind, it's evident that we are increasingly surrounded by a multitude of devices on a daily basis. At the core of these devices lie semiconductors. Therefore, it's inevitable that the semiconductor market will experience rapid expansion in the coming years.

Talking about Fab Plants in India:

Setting up fabs (semiconductor fabrication facilities) in India is not an easy task or an industry that can be set up overnight. The Challenges for India include capital investment requirements, complex regulatory processes, inadequate infrastructure, and a shortage of skilled labor. Therefore, while there is potential for fabs in India, overcoming these challenges is necessary to establish a competitive semiconductor manufacturing ecosystem.

However, companies such as Tata Group and Tower Semiconductors have already announced their interests to setup up a Fab plant in India. This is a major step and India will bring in the whole ecosystem of Semiconductors.

Q. Speaking of Suchi Semicon, when have you founded the company and what is your current mission and vision?  Kindly elaborate your current strategies.

I envisioned entering the semiconductor industry in early 2022. After extensive research, networking in India and abroad, and laying the groundwork, the company was officially incorporated on 5th July 2023, with its headquarters strategically located in the heart of Surat, Gujarat. Suchi Semicon aims to emerge as a global leader in semiconductor assembly, recognized for unparalleled quality, unmatched reliability, and an unwavering commitment to customer satisfaction. The company's mission is to provide high-quality semiconductor assembly solutions that drive innovation, empower technological advancements, and enable customers to create cutting-edge products contributing to a better world. 

Current Business Strategies:

  • Strategic Growth Plan: Suchi Semicon is implementing a strategic growth plan that spans over the next five years. This phased approach ensures steady expansion while maintaining operational efficiency and quality standards.
  • State-of-the-Art Facility: Our semiconductor OSAT factory is equipped with state-of-the- art Class 10k and 100k cleanroom facilities, spanning an initial area of 30,000 square feet. This facility is designed to meet the stringent requirements of semiconductor assembly, ensuring precision, cleanliness, and efficiency.
  • High Production Capacity: Our factory aims to achieve an impressive and cost-efficient production, focusing initially on SOIC, SOT223, QFN packages, and other advanced semiconductor packages. The production will allow us to cater to the growing demand for semiconductor devices in India and globally.
  • Advanced Technological Focus: Suchi Semicon is committed to staying at the forefront of semiconductor technology. We are investing in cutting-edge equipment, tools, and processes to deliver superior quality products that meet the evolving needs of the industry.
  • Skilled Technical Team: Our company prides itself on its highly skilled and experienced technical team, with a collective expertise of over 35 years in the semiconductor industry. This team will drive innovation, ensure product quality, and provide comprehensive engineering support to our clients.

Through these strategic initiatives, Suchi Semicon is on the track to make a significant impact in India's semiconductor landscape. We are dedicated to driving growth, fostering innovation, and contributing to India's emergence as a global leader in semiconductor manufacturing. Suchi Semicon has already signed an MOU with the Government of Gujarat at the Vibrant Gujarat Summit 2024 for an investment of 870 crore rupees along with employment for 1200 employees.

Q. Why are you claiming yourself to be India’s first OSAT/ATMP facility? We have Micron and another Indian company. With this facility, what is the market turnover you are expecting in India and globally? What is the total number of employees you are expecting in your unit?

Suchi Semicon Pvt Ltd proudly asserts itself as India's first OSAT (Outsourced Semiconductor Assembly and Test) / ATMP (Assembly, Test, Mark, and Pack) plant in Gujarat and the forefront of New Age India. While Micron had planned way before us but since their scale is huge, to start for them will be quite some months from now.

Market Turnover Expectations: For the year 2029, Suchi Semicon projects a robust market turnover of 950 Crores INR, encompassing both domestic and global markets. This projection reflects our confidence in the demand for semiconductor assembly and testing services, driven by India's growing technological advancements and the global semiconductor market's continual expansion.

Expected Employee Count: By the year 2029, Suchi Semicon anticipates a workforce of approximately 900 to 1200 employees. This team will comprise skilled professionals across various functions, including engineering, manufacturing, quality assurance, research and development, and administrative roles.

Assembly, Testing, Monitoring and Packaging Unit (ATMP)

Q. Kindly elucidate the various services offered by your ATMP unit? What is your investment and the kind of latest technology deployed by you?

Suchi Semicon offers comprehensive semiconductor assembly services, including die attach, wire bonding, Molding, marking and package sealing (tape and reel, trays, and tubes). These services ensure the precise and reliable assembly of semiconductor components into packages ready for use in electronic devices. We will also specialize in providing customized solutions tailored to the specific needs of our clients. This includes designing and developing unique packaging solutions, testing methodologies, and assembly processes to meet the requirements of diverse semiconductor applications.

Investment and Latest Technology Deployed:

Suchi Semicon will make a strategic investment of Rs 870 Crores in its state-of-the- art OSAT/ATMP unit. This investment encompasses the establishment of cleanroom facilities, procurement of advanced equipment, and talent development initiatives. Through our wide range of services, strategic investment, and deployment of the latest technology, Suchi Semicon OSAT/ATMP unit is dedicated to providing top-tier semiconductor assembly, testing, marking, and packaging solutions to meet the evolving needs of the semiconductor industry in India and globally.

Q. Going forward, how Suchi Semicon is aiming to enhance India’s role in the global semiconductor value chain? What will be your key focus areas?

Suchi Semicon Pvt Ltd is committed to playing a pivotal role in enhancing India's position in the global semiconductor value chain. Our strategic initiatives focus on leveraging India's strengths, fostering innovation, and developing a robust ecosystem for semiconductor manufacturing and assembly.

Key Focus Areas:

  • Technology Advancements and Innovation Skill Development and Talent Acquisition Global Partnerships and Collaborations Localization and Domestic Manufacturing Quality and Reliability Assurance
  • Market Expansion and Customer Satisfaction

Through these key focus areas, Suchi Semicon is poised to enhance India's role in the global semiconductor value chain.