Tech

When Will India Have A Commercial Silicon Fab? 2023, If…

  • We have relied on generalists who are pushed to produce results, but the semiconductor industry is the epitome of specialisation.
  • Intent without implementation expertise and machinery to back the political will, will reduce the whole exercise to glorified ribbon cutting. 

Dr Santhosh OnkarJan 01, 2023, 01:19 PM | Updated Feb 16, 2023, 09:18 PM IST
Representative image for semiconductors

Representative image for semiconductors


It is that time of the season when people start making wishes and end up making yearly resolutions that evaporate as dissolutions before long. 

As 2022 comes to an end, I attempt the usual exercise of looking back in order to understand the future.

A fireside chat reference is in order as a precursor:

A former colleague (formerly of Semi-Conductor Laboratory) provided an interesting answer to the question: ‘By when do you think will India have a commercial silicon fab?’ (A "fab" is a semiconductor fabrication plant.)

He said, “Sir, it is very simple. The day the developed world blocks Indian access to silicon chips, we will have a fab in no time, just like we did for rockets and supercomputers. Until then, the physics of inertia will ensure we meander along.”

This answer had an eerie similarity to journalist-analyst Shankkar Aiyar’s thesis chronicling the pre-2014 Indian journey in his book Accidental India. He begins thus, in his preface:

“Why is crisis the stimulus for positive change in India? Is the flaw cultural or political? The country seems to dwell permanently in the domain between celebrated potential and frustrating failure. Will the nation’s leaders only act when spurred on by shame or fear?”

Let us contemplate the Accidental India thesis to understand the status quo in the pursuit of a fab in India, based on inputs from several blindfolded men involved in the process of prodding at the proverbial elephant in the form of the question ‘When can a commercial silicon fab happen in India’ and describing its anatomy.

Silicon Singularity: Missed Opportunity Due To Inadequate Homework?

By mid-2020, the news of an impending semiconductor chip shortage, due to limited wafer capacity at fabs riding on the back of a pandemic, was doing the rounds in most of the fabless companies and original equipment manufacturers (OEMs) around the world.

In this backdrop, I was curious to understand how Taiwan, in such a short span, managed to become a global leader in semiconductors using the pure-play foundry model?

The research culminated in a series of articles beginning with this article (January 2021) in Swarajya. It coincided with government activity scouting for potential fab ventures with expressions of interest (EoIs) and then subsequent request for proposals (RFPs).

Onshoring fabs was gaining traction in the Indian media, with Arun Mamphazy (a Swarajya contributor) leading the pack informing Indian netizens of the various aspects of semiconductor fabrication.


Kudos! Perhaps India's time had come.

It was Aiyar’s “celebrated potential” among electronics enthusiasts ending up in “frustrating failure” because, during the same time frame, the United States (US), Japan, Europe, Singapore, and Malaysia onshored investments up the value chain and are nearing completion to start production in the coming year.

Even though the usual ingredient of an India-centric crisis was missing, I hoped a happy coincidence of the global crisis was sufficient and/or this time things may be different.

It seems this understanding was incomplete, and some observers have tried to help me with better reasoning. I summarise it here for Swarajya readers.

Disregard For Institution Building Through Learning

Institution-building involves deliberate injection of fundamentally different values, functions, and technologies, requiring changes in the institution's character, edifice, and behavioral patterns.

Unfortunately, as Aiyar aptly summarises (emphasis mine):

“Our civil administration—the permanent government—is not designed for acceleration. While development depends on the quality of administrative capacity and quality comes from specialization, we continue to depend on generalists.”

This observation is the closest characterisation of events that have unfolded so far in the pursuit of ‘making silicon fabs in India’.

We have relied on generalists who are pushed to produce results, but the semiconductor industry is the epitome of specialisation. Generalists will be found wanting here as specialised knowhow is the bedrock of success, as detailed in this article.

Intent without implementation expertise and machinery to back the political will, will reduce the whole exercise to glorified ribbon cutting. 

Additionally, our Ministry has chosen to employ many of the hired resources in organising functions and melas; perhaps, some of that energy would have been better invested in using bright people (of which we have no dearth) and bringing onboard vital institutional learning through rigorous Master’s theses and/or PhDs (Doctor of Philosophy degrees) to map and understand the complete value chain and possible entry points.

The field of semiconductors is highly competitive, where talent is paid top-dollar; hence, a year without finding a CEO (chief executive officer) to head the India Semiconductor Mission (ISM) should have brought some realisation in the Ministry that it is not all that easy to find the right talent without focused vision and homework to back that intent into time-bound action.

Employees at a semiconductor facility (Photo: Semi-Conductor Laboratory)

The Proposals In Waiting

Practicalities plaguing evaluation

The Ministry has marshalled the IIT (Indian Institute of Technology) professors at its disposal to evaluate proposals because the Ministry neither has the technical expertise nor the human resources to evaluate the submitted proposals.

This exercise brings a few practical challenges that are worth mentioning. Firstly, this is an additional load on a professor’s already-stretched-out role involving teaching, administrative exigency for funding and resource management, their individual research, and the new startup frenzy.

In spite of this heavy load, saying “no” might bring the ire of bureaucracy, which is best avoided; therefore, these professors would still accept this additional task just to be in the good books of the Ministry.

Second, since the scope of these proposals involves many aspects that fall outside their expertise (for example, material sourcing and business-case financials), they would need more time and effort than they would have employed in the regular “principal investigator” role, thereby stretching the timeline of the entire process.

Actual proposals and the related quandary: The choice that India doesn’t have

Restricting the scope to the three proposals of big-ticket silicon fabs, an ideal scenario that the Ministry would have hoped for is a big conglomerate (“Chaebol”) with a proven track record backed by a solid international technology partner.

On the contrary, it is apparent that these proposals are not the ideal scenario that the government would have hoped for. Since India has remained largely a “Chaebol” economy, whether one agrees or not, we are evangelised to the popular belief that an initiative has a higher probability of success if it is backed by a “Chaebol”.


The Ministry is in a precarious spot because they can’t restart the whole process hoping to get better proposals because it would send the wrong signal. The existing proposals lack the confidence-instilling entities in the form of a strong technical management team with a proven track record or, in some cases, the absence or ambiguity of a technology partner backing the proposal.

Perhaps, the delay can be construed as a time-buying exercise hoping for a better alignment of stars or a change in scenario, which is futile. We will have to bite the bullet sooner or later. The sooner, the better.

I will end with this quote from Aiyar’s Accidental India (emphasis mine):

“A nation of over a billion people cannot wait endlessly for accidents. Crisis cannot continue to be the clinching argument for change. …. Governance in India, in 2012, is a sham and a shame. The glaring absence of strategic objectives is ubiquitous. In every crisis …, the common thread is the inability of successive governments to think imaginatively and act decisively. India deserves better.”

This was his prognosis in 2012, but we have advanced by a decade since then. Let us hope that the year 2023 will usher in this much-needed imagination and decisiveness that can propel India’s silicon manufacturing — this time hopefully without a compelling crisis.

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