India aiming to catch up in semiconductor manufacturing, potentially giving a big boost to the industry
The Indian government, in a bid to accelerate semiconductor manufacturing and compensate for lost time, is gearing up to announce a substantial new incentive package. The existing Rs 76,000-crore package, launched in December 2021, has nearly depleted, prompting the need for a larger infusion of funds to bolster India’s semiconductor ambitions. According to reports, the forthcoming package is expected to surpass the previous one significantly and will likely become a top priority for the new government once it assumes office. This initiative comes in response to the aggressive investment strategies of countries like the US and China, which have unveiled substantial incentives to foster semiconductor production.
Despite initial struggles in attracting viable proposals for semiconductor manufacturing, India achieved a significant breakthrough when American Micron established a Rs 22,500-crore testing and packaging unit in Gujarat in June last year. The success of the December 2021 incentive package has spurred the government to develop a new one, especially as the current fiscal support for eligible display and semiconductor fabricators, covering up to 50% of project costs, is nearly exhausted due to recent investments flooding in. With many proposals at advanced stages, the government faces crucial decisions on incentives to propel India’s semiconductor industry forward amidst global competition.
Editor’s Note: India is poised to announce a substantial new incentive package aimed at accelerating semiconductor manufacturing, following the depletion of its existing Rs 76,000-crore package. With the emergence of successful ventures like American Micron’s testing and packaging unit in Gujarat, the government aims to bolster India’s semiconductor ambitions amidst stiff global competition.
India, Chinese Taipei request WTO to delay ruling on ICT import taxes dispute
India and Chinese Taipei have jointly requested the WTO’s dispute settlement body to withhold any ruling on New Delhi’s import duties concerning certain information and technology products until July 26, as both sides work towards resolving the issue. This request was made during a meeting of the dispute settlement body (DSB) in Geneva on April 26, and the body agreed to delay consideration of the dispute panel’s reports until the specified date. This marks the fourth such request for delay from India and Chinese Taipei, aiming to facilitate the resolution of the disputes.
A dispute panel of the WTO, in its report dated April 17, 2023, found that import duties imposed by India on specific information and technology products violate global trading norms, following a case filed by the EU, Japan, and Taiwan. Chinese Taipei initiated a case against India in May 2019 over import duties on certain electronic goods, stating that they are covered under WTO’s Information Technology Products (ITA-2) agreement, from which India is not a participant. India argues that it adheres to ITA-1, signed in 1997, which does not require the elimination of customs duties on these products.
Editor’s Note: India and Taiwan have jointly requested the WTO to delay any ruling on New Delhi’s import duties concerning specific information and technology products until July 26, as they continue efforts to resolve the issue. This marks the fourth request for delay from both parties, demonstrating their commitment to finding a mutually acceptable solution to the dispute.
Japan’s Sharp to invest $3-5 billion in a display fab semiconductor unit in India
Japan’s Sharp Corporation plans to invest $3-5 billion in establishing a display fab semiconductor factory in India, aiming to manufacture televisions and digital screens. The proposed sprawling facility, expected to cover 1,000 acres, signals Sharp’s substantial commitment to serving both local and global markets, with meetings held with India’s Communications Minister Ashwini Vaishnaw indicating serious intent.
The proposed factory aims to produce cutting-edge Series 10 displays, positioning India as a significant player in the global semiconductor landscape. Discussions with state governments in Telangana, Gujarat, and Maharashtra for land acquisition are underway, although approval timelines may be affected by ongoing elections. This move aligns with India’s ambition to achieve self-sufficiency in semiconductors, with other global players also expressing interest in India’s semiconductor ecosystem. This burgeoning industry holds promise for reducing import dependency, fostering indigenous innovation, and driving economic growth, with India striving to become a major semiconductor manufacturing hub with substantial investments and policy support.
Centre Wants Manufacturers of Electronic Components To Protect Security Interests of the Nation: IT Secy
Union IT Secretary S. Krishnan emphasized the need for electronic component manufacturers to prioritize national security interests in their projects. Speaking at the 10th G Ramachandran Endowment Lecture, he underscored the importance of incorporating cybersecurity measures from the design phase itself. Krishnan highlighted the significant national risks posed by cyber threats and advocated for a “secure by design” approach to ensure the country’s security interests are safeguarded from the outset of product development.
Additionally, Krishnan stressed the importance of building resilient supply chains to mitigate external risks, such as geopolitical tensions. He pointed out the vulnerabilities exposed during the COVID-19 pandemic and emphasized the need for diversification to prevent disruptions in critical industries like semiconductor manufacturing. Furthermore, he highlighted the Ministry of Electronics’ efforts to address climate change by collaborating with other departments to optimize production processes and promote sustainability.
Editor’s Note: Union IT Secretary S. Krishnan emphasized the imperative for electronic component manufacturers to prioritize national security interests by integrating cybersecurity measures from the design phase. Speaking at the 10th G Ramachandran Endowment Lecture, Krishnan highlighted the necessity for a “secure by design” approach to mitigate cyber threats and advocated for resilient supply chains to address external risks, underscoring the Ministry of Electronics’ initiatives towards sustainability and climate change mitigation.
Tata Electronics developing hi-tech machines to produce iPhone cases
Tata Electronics is reportedly spearheading the internal development of sophisticated high-precision machines essential for producing iPhone casings. Partnering with two Indian manufacturers, the company aims to enhance its capabilities domestically and eventually export these machines. Previously reliant on imports from China, Tata’s move signals a strategic shift towards self-reliance and boosting India’s manufacturing ecosystem. These machines, vital for production lines of contract manufacturers serving global giants like Apple, are being tested at Tata’s Hosur facility, reflecting a broader objective to reduce dependence on specific components and foster local expertise.
The initiative holds significant potential to catalyze an industry around casing production in India, according to experts. If successful, Tata’s efforts in import substitution could establish a new standard for high-quality machine manufacturing in the country, aligning with Apple’s stringent standards. Amidst a growing emphasis on precision manufacturing, the development of such capital goods is deemed crucial by industry leaders, signaling a broader ambition to position India as a key hub for electronics assembly and components.
Editor’s Note: Tata Electronics is leading the development of sophisticated machines for iPhone casing production, aiming to reduce reliance on Chinese imports and bolster India’s manufacturing capabilities. This strategic move not only signifies a shift towards self-reliance but also holds the potential to establish India as a significant player in precision manufacturing and electronics assembly, aligning with global standards set by companies like Apple.
WhatsApp tells Delhi High court to leave India if forced to break encryption
In an ongoing hearing at the Delhi High Court, Meta-owned WhatsApp reiterated its stance that it would cease operations in India should it be compelled to compromise its message encryption protocols. Emphasizing the centrality of end-to-end encryption in safeguarding user privacy, WhatsApp’s legal representative, Tejas Karia, underscored that the platform’s decision to maintain encryption integrity is non-negotiable. With India being WhatsApp’s largest market, boasting over 400 million users, the platform’s commitment to privacy resonates strongly amidst ongoing legal challenges.
WhatsApp and its parent company, Meta, are actively contesting the Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules 2021, which mandate message tracing and sender identification. Arguing that these regulations undermine encryption and violate constitutional privacy rights, WhatsApp contends that compliance would compromise user privacy and constitutional guarantees. Despite defense from the central government, which highlights the necessity of tracing message originators in contemporary contexts, the Delhi High Court has acknowledged the complex balance between privacy rights and regulatory imperatives. Scheduled hearings on WhatsApp and Meta’s petitions are set for August 14, reflecting the high-stakes legal battle over encryption and user privacy in the digital age.
Editor’s Note: In ongoing hearings at the Delhi High Court, WhatsApp reiterated its firm stance to cease operations in India if compelled to compromise its message encryption protocols, highlighting the non-negotiable nature of end-to-end encryption in protecting user privacy. With over 400 million users in India, WhatsApp’s commitment to encryption integrity underscores the high stakes in the legal battle over privacy rights and regulatory demands.
To disrupt India’s consumer electronics and home appliance business, Mukesh Ambani turns to ‘Wyzr’
Reliance Industries Ltd (RIL) is in the final stages of negotiations with domestic contract manufacturers Dixon Technologies and Mirc Electronics to bolster its new brand, Wyzr, in the Indian consumer electronics and home appliances market. Launched in the financial year 2023-24, Wyzr initially introduced a range of coolers and now plans to expand into other product categories, aiming to challenge the dominance of multinational corporations in the local market. Led by Mukesh Ambani, RIL’s strategic move aligns with its successful disruption of the feature phone market through JioPhone and leverages the government’s Make in India initiative to capitalize on domestic manufacturing capabilities.
Wyzr products are positioned to offer competitive pricing compared to established brands like LG, Samsung, and Whirlpool, with an eye on capturing market share in segments such as air conditioners where Tata-owned Voltas currently leads. RIL’s previous attempts in the consumer electronics sector, including the Reconnect brand for televisions and appliances, faced limited success due to reliance on partners for design and manufacturing. Recognizing the need for greater control over product development and manufacturing, RIL is pursuing an independent brand strategy to establish a stronger foothold in the rapidly evolving Indian consumer electronics landscape.
Editor’s Note: Reliance Industries Ltd (RIL) is finalizing negotiations with Dixon Technologies and Mirc Electronics to strengthen its new brand, Wyzr, in India’s consumer electronics and home appliances market. Led by Mukesh Ambani, RIL aims to challenge multinational corporations’ dominance by leveraging domestic manufacturing capabilities and competitive pricing strategies. With a focus on expanding beyond coolers, Wyzr seeks to capture market share in segments like air conditioners, aligning with RIL’s independent brand strategy to establish a stronger presence in the evolving Indian consumer electronics landscape.