Beyond the Strait: Taiwan-India Chip Cooperation and Taiwan’s role in India’s Semiconductor rise

By R Anil Kumar

• The Indian government looks set to continue building up the Country’s Semiconductor ecosystem and Taiwan’s considerable expertise is especially valuable and ought to be utilised

• Taiwan manufactures around 63.8 percent of the world’s Semiconductor, and its 2nm process technology is the most available advanced technology in the world

Bengaluru: The past few months have seen tremendous strides in India’s journey to develop a vibrant Semiconductor and Electronics ecosystem. India’s Prime Minister Narendra Modi’s vision of “Make in India” and “Design in India”, have been the guiding force behind developing a vibrant Semiconductor and Electronics ecosystem.

The government of India provides help private entities to establish Semiconductor fabs in India, and in this environment Taiwan’s government and its Companies have become front runners as Taiwan manufactures around 63.8 percent of the world’s Semiconductor, and its 2nm process technology is the most available advanced technology in the world.

Cooperation with Taiwanese companies provides invaluable technological support to India’s Semiconductor Industry,

Notable Partnerships with Taiwan in India’s Semiconductor Industry: In February this year(February 2024), Taiwanese Company, Powerchip Semiconductor Manufacturing Corporation (PSMC) and Indian Company Tata Electronics, announced plans to invest US $ 11 billion, to build India’s first 12-inch wafer fab in Dholera, Gujarat.

This Joint-venture between Indian and Taiwanese Company has provided the foundation for India-Taiwan joint Manufacturing of Chips in India. The new venture is directed towards manufacture of Power management integrated circuits (ICs), display driver IC, micro-controllers and high performance computing logic components. This project is expected to create more than 20 thousand job opportunities.

The Taiwanese Company Hon Hai Precision Industry Company Ltd, has its presence in India with Plants in Bengaluru, Chennai and Hyderabad.

FOXCONN and Hindustan Computers Limited (HCL) Group are planning a Joint-venture to set up a Semiconductor outsourced assembly and testing unit. Foxconn is investing US $ 37.2 million in the project and hold an equity stake of 40 percent. Foxconn’s decision to hold equity will ensure the supply-chain resilience for the needs of India’s domestic Industry even after the completion of the project.

These Partnerships and Collaborations between India and Taiwan also encourages more cooperation and dialogues between the Companies of the two Countries.

India’s Semiconductor market is expected to grow at a compound annual growth rate (CAGR) of 26.3 percent to US$ 271.9 billion by 2032.

Taipei’s new South-bound Policy (NSP) positions countries like India as strategic partners and encourages Taiwanese Companies to invest in India.