American chipmaker Micron Technology investing up to $825 million in a new assembly and test facility in Gujarat fits well into the plans of both India and the US. Support from the Central and state governments would take the total investment in the facility to $2.75 billion, as Prime Minister Modi pushes his ambitious $10-billion incentive plan for chip manufacturing. For Washington, Micron’s decision is in sync with its policy to decrease the risks of doing business in China while integrating the US economy with that of India. Last month, Beijing barred Micron products, saying it had failed a security review, angering the Biden administration.The construction of the new facility is expected to begin soon and the first phase will be operational in late 2024. The unit will test and pack semiconductor chips, but not manufacture them. Still, Micron’s plant is a boost to the vision of making India a semiconductor base. US semiconductor toolmaker Applied Materials will also invest $400 million in a new engineering center. Lam Research plans to train 60,000 engineers. For decades, India had a relentless focus on software-related knowhow. The results are visible in an array of digital technologies. Cracking the hardware puzzle is a different ballgame. Subsidies alone will not result in relocation of chip supply chains. Larger clusters that can support manufacturing and sustain long-term operations as well as transfer of technology are key.

The global chips market is expected to grow to $1 trillion by 2030. Resource-intensive, it requires highly-skilled workers and is already facing a competence gap. As India embarks on its silicon journey, semiconductor job openings are set to rise. With its talent pool, India needs to leverage the opportunity and find ways to provide hands-on and industry-relevant training to engineering students. Taiwan provides a cue. Its success is attributed to public-private partnerships that focus on training and certification.
(Tribune, India)