India’s Semicondactor Policy Amidst Geopolitical Turbulence

Abstract

The article discusses the state of India’s semiconductor and microelectronics policy at the present stage. Today the semiconductor industry is key to the technological progress of any state, and even more so India, which seeks to enter the list of the world's leading powers. Since the mid-20th century, the Indian leadership has been trying to develop science at home, building up human resources in vitally important areas for the country. At the initial stage, the developing state relied on the technology imports, while limiting foreign participation in strategic industries. Yet since the late 1980s and especially since 1991, the government began to liberalize the economy, gradually removing previous restrictions on foreign investment and actively engaging in international cooperation in the most promising areas. Modi's coming to power marked a new period of Indian innovation development. The coronavirus pandemic as well as the growing geopolitical standoff between the US and China, have provided additional incentive to India’s industrialization in critical fields, including semiconductors. In turn, the establishment of a Semiconductor Mission in 2022 and the measures introduced by the government should help strengthen the country's technological sovereignty. As the study shows, the late start of reforms and the country’s catching-up development will prevent India from becoming globally competitive. In the short run, the only two promising sectors are chip design and assembly, testing, marking and packaging; while in other fields, Indians are likely to expand the geography of both fabless and production complexes, though limiting themselves to meeting the state’s basic needs.