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Working towards developing talent for semiconductor and electronics manufacturing: MeitY secretary

While India has a design talent pool for semiconductors, it needs a talent pool for manufacturing, and a supply chain, said S Krishnan, secretary, Ministry of Electronics and IT (MeitY). He was speaking at an event by the India Electronics and Semiconductor Association (IESA) on Wednesday in Bengaluru.

“Do we have significant parts of the value chain that brings manufacturing into India? The chief executive of Micron said we have a huge talent pool as far as design is concerned but as it is setting up a manufacturing facility it needs enough people in the manufacturing space,” he said.

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Krishnan said that while institutes likeIndian Institute of Scienceare training several Mtech graduates and PhDs, in design of semiconductors, the people who are in most demand are technicians, he said.”They say the technicians who run the shop floors are most sought after. So clearly there are areas of talent that we need to work on, and areas of supply chain that we need to work on,” he said.

There’s a strong revival of electronics manufacturing, he said. More than 99% of the demand for mobile phones in India is met here by manufacturing them within the country, he said.

Other forms of electronics, both consumer electronics and other types are getting increasingly manufactured here, he said.

Electronics is the fastest growing sector among other sectors, he said. In the first nine months of this fiscal year from April to December, electronics exports grew by 22 percent, he said.

No country accounts for more than 40% of the electronics value chain in the world, he said. The value chain spans different countries, he said.

“We should target taking our share to the value chain to 35%. With the US we have an agreement on how to proceed further with the semiconductor supply chain, and how to locate it between India and the United States. Likewise with the European Union and Japan,” he said.

Around eight states in India mention catering to the semiconductor industry while four states have specified semiconductor policies, said a report released by the India Electronics and Semiconductor Association (IESA) on Wednesday.

The semiconductor-related capital subsidy provisions of four States include Gujarat where 40% of additional capex incentive is given (20% of overall project cost), and Odisha where 50% of additional capex incentive is given (25% of overall project cost) for projects going through the India Semiconductor Mission (ISM), and 30% of overall project capex as capex subsidy is given for projects not going through ISM.

The capex subsidy is offered on a pari pasu mode.

In Tamil Nadu, 50% of additional capex incentive is given (25% of overall project cost) and capex subsidy is offered in a pari pasu mode.

In Uttar Pradesh, 50% of additional capex incentive is given (25% of overall project cost).

The report provides for a factual summary of the semiconductors and electronics, system design and manufacturing (ESDM)-related policies of the Government of India and 14 State policies, IESA said.

It mentions the quantum of fiscal subsidies like capital subsidies, land subsidies, power supply incentives, water incentives, interest subsidy, State tax (SGST) reimbursement, production-linked incentive, skill and human resource subsidies, provided by these 14 States.

It also mentions non-fiscal subsidies like single window clearance, self certification, preferential market access, and policy for fabless firms.

Policies mentioned are of States including Andhra Pradesh, Chhattisgarh, Gujarat, Haryana, Kerala, Karnataka, Madhya Pradesh, Maharashtra, Odisha, Punjab, Rajasthan, Tamil Nadu, Telangana, and Uttar Pradesh.

Veerappan V, vice chaiperson, IESA, said, “With the Indian semiconductor market poised to reach a valuation of $80.3 billion by 2028, we hope that this report will help in attracting more investments and innovations in this sector.”

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